Director of Finance and Resources, Alan Smith, has just written a blog post for the National Housing Federation, which you can read below.
Why we need a new approach to setting housing association rents
In the context of the wider housing sector, believe housing is still a toddler, as we’ve only just celebrated our second birthday. We are growing up fast though, as our first two years have presented their fair share of challenges. We have made a very good start with:
- streamlined governance arrangements
- service reviews leading to a more efficient approach
- new customer engagement arrangements
- investment in technology to support new delivery
- agile working progressing at pace.
New homes are already let and grants to support additional development is secured.
Having achieved all of this we don’t want progress to stall. Our vision is a ‘life without barriers’ and we know there is much to do to support our customers and invest in our communities if we want to make this a reality. Developing an offer for new customers struggling to access the market is another challenging priority.
The current business environment has been described as uncertain, volatile and unpredictable. This impacts our ability to plan with certainty and confidence, develop strategy and consider risks. Our interest in supporting the Federation’s work in building a case for a new approach to rents hinges around the need for clarification. Having greater control over rents will not only allow us to manage the requirements of our communities both now and in the future, but also to help find a solution that works best for us and our customers.
Is this just a charter for increasing rents across the board? We don’t see it that way at all and it’s probably not possible where we are in the north east of England. Markets are challenging and communities need a mixed offer retaining an element of affordable rents, private rents and home ownership. This requires careful management in some areas to retain the balance with price differentials often being marginal.
We are also wrestling with the impact of Local Housing Allowance (LHA) levels on tenancies, particularly the shared room rate for under-35s which, for the Sunderland area covering almost half of our stock, currently runs at less than £50 per week. Being honest, we aren’t sure of the answers yet but we can be certain that having some control over rents to balance off the extremes can only help.
So why argue for change? Trying to hang on to the status quo could be tempting, but it’s looking less likely that it still exists. So surely looking to develop our own solutions, as difficult as it might appear, is a better option than waiting, fingers crossed, for a favourable settlement.
Balancing the challenges is crucial as the pressure cannot all be downward. It is important that any revised approach to rents allows for an organisation to meet affordability challenges, but also ensure the financial strength of the organisation if it is to plan for and deliver new investment both for new homes but also, importantly in our view, in existing communities.
This blog post was originally published on the National Housing Federation’s website here.