What choices are landlords making when they allocate housing - and how well are they working out? Inside Housing and Housing Partners surveyed industry professionals for answers
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With housing need rising and the available stock of social and affordable rented homes in decline, the sector is lurching ever closer towards an allocations crisis.
Social landlords need to consider whether they are utilising the most efficient tools available to house those in the most need, as quickly as possible. Most importantly that includes making sure that new potential tenants understand what is required of them throughout the applications process.
To find out more, Inside Housing and allocations solution provider Housing Partners launched a survey of associations to find out how they let their social and affordable homes. It posed a number of questions, such as whether they thought their current allocations systems were fit for purpose and if they prioritised specific groups when allocating new homes. In total, 148 housing professionals working in allocations took part and the results paint an interesting picture.
Since the government first introduced choice-based letting (CBL) schemes back in 2001, they have remained a firm favourite method of allocations for many housing associations and local authorities. This remains the case today, as our survey demonstrates.
CBLs are the platform through which the majority of organisations predominantly let their properties, with 64% of respondents saying that they mainly used choice-based systems.
The effectiveness of choice-based letting systems have come under fire in recent times, with Hounslow and Rochdale two recent high-profile councils that are looking at ending their CBL schemes.
One alternative is to allocate homes directly through the housing register, which is what 14% of respondents said their organisation does. One such association is 12,000-home Wrekin Housing Trust, based in the West Midlands.
David Wells, head of operational services at Wrekin Housing Trust, says that his organisation used to operate a CBL service which “worked really well for a number of years” but demand caused the association to rethink the way it approached allocations.
“We got to a point of thinking ‘how can this possibly be working for customers when there are 15,000 people registered, but only 800 vacancies consistently every year?’,” he says.
“So our view became, is there really much choice for the vast majority of people?”
There is definitely a question hanging over whether traditional choice-based systems still work. The majority do think they are fit for purpose (41%), but a further 38% said they weren’t, with almost 22% of people responding that they ‘didn’t know’.
Su David, lettings team leader at Worthing Homes, believes that choice-based lettings are still fit for purpose, however she admits that improvements could be made.
Worthing Homes’ CBL system features fortnightly bidding, but Ms David says that a move towards a weekly system would be better for the customer, the local authority and the housing providers.
“In my worst-case scenario, my deadline for advertising is at 11am on a Tuesday and if I get a termination that comes in at 3pm on a Tuesday afternoon, I despair because I’d have to wait 13 days before I can advertise the property again.”
Although there are some grumbles about CBLs, the majority of respondents do appear to be supportive of their current lettings platforms. More than 60% of participants described their current lettings system as ‘easy’ (46%) or ‘very easy’ (16%) to use.
Additionally, most believe that their current lettings system does secure enough demand for their properties - 64% reported this was the case, with 26% saying no and the final 10% not knowing.
Most were also content with the level of freedom and flexibility their organisation’s current allocations system offered them. More than 60% of people said that they held this view.
When it comes to allocations, it’s important that tenants know how to understand and capably navigate their housing options. Without clear instructions or guidelines, the process can be frustrating, especially for the most vulnerable.
Almost two-thirds say that tenants do find the applications process straightforward. However, what’s less reassuring is that many lettings professionals do see the same applicants continually applying for houses they won’t get. Forty-five per cent of respondents had experienced instances of this.
Simon Hollingsworth, managing director of Housing Partners, warns that if the process isn’t made simple for prospective tenants, social landlords could end up confusing and losing those in need of homes.
“If prospective tenants are not in the right preference group, they may turn to other advertising portals, with social landlords further competing with the private rented sector. The result of this for home-seekers is a more fragmented application process, with increased uncertainty about where to go and who to turn to for advice,” he says.
“It’s essential that landlords have access to tools that manage enquiries from outside their CBL systems, to ensure efficiency in the process at a time when resources are under pressure.”
A common issue noted in responses was that some applicants take a “scatter gun approach” to bidding in the hope of getting at least something, rather than nothing.
Although all organisations have their own allocations policy or scheme, there are requirements for councils to prioritise ‘reasonable preference’ groups - such as those who are homeless - when allocating housing.
We asked respondents which groups of people they prioritise outside of those who are considered under reasonable preference, and it delivered some thought-provoking responses.
Housing those with healthcare needs was the most popular option, with 70% of respondents saying that they prioritised those people. Other popular responses included those at risk of domestic abuse (63%) and those in under-occupied social rented housing (63%).
With benefit changes, such as the Local Housing Allowance cap, affordability of rented homes is an increasing concern for many organisations. The vast majority of housing organisations do have ways of ensuring their tenants can afford the properties that they are applying for, but a surprising amount do not.
Four-fifths of organisations do a pre-tenancy financial assessment or ask tenants financial questions, but 19% currently do not have such a system in place. However, 8% of those are currently in the process of developing one.
Mr Wells of Wrekin Housing Trust says it’s crucial that organisations are placed to understand their potential tenants’ financial capabilities.
“To actually have that risk assessment at the front is about making sure that the tenants benefit, that they’re absolutely equipped to be able to support themselves, but if they can’t to put the support in place for them,” he adds.
Overall, most thought that their letting systems were working well for their organisations. On a scale of one to five, 55% of respondents rated their system ‘four’ or higher. Only 11% rated their allocations platform lower than ‘three’.
Mr Hollingsworth of Housing Partners says the survey raises a number of significant issues.
“Important findings from the survey to highlight include the need for more flexibility for lettings cycles, so that advertising of properties can be more frequent and tailored to requirements. Longer cycles may impact on operational performance, increasing void turnaround times and therefore reducing rental income at a time when income is under pressure.”
He concludes: ”With cuts to waiting lists and increasing competition from the private rented sector for advertising spaces, providers are seeking new methods of filling homes, ones which are designed specifically for social housing.”