Safe Haven Project - Housing Associations - Policy

Safe Haven Project - Private Sector Leasing

Procedural Points on Running a Private Sector Leasing Scheme

Summary

This page sets out some of the miscellaneous points of procedure and administration that have arisen in the design of the Scheme.

Further Information

Acquisition of properties

Relationship with the Local Authority

The framework agreement is important for a number of reasons. One of which is that Registered Social Landlords can have in place the requisite number of staff to meet the LA requirements for the acquisition of properties. One fulltime employee to acquire and manage between 50 – 75 properties appears to be the norm.
Acquiring the appropriate number of properties within a time scale demanded by the local authority can be a difficult balancing act. The RSL will need to begin negotiations on more properties than will eventually be acquired as there will be some owners who will withdraw during the negotiation period.
Negotiations with landlords require a number of skills that are not traditionally associated with housing association lettings and it is important to acquire the right calibre of staff to undertake this type of work. A far more commercial focus is required.
One point of contact within the local authority and the RSL allows for quicker negotiations where time constraints mean that delay can become a real issue.

Relationship with the Owner

Failure to keep owners informed is a major cause of complaint and it is important that they are kept informed at each stage during the acquisition procedure.

Housing Benefit

Any major changes to the Housing Benefit Scheme which reduce entitlements to large number of tenants will result in an unforeseeable loss of income to associations. This risk is outside the control of the association and the local authority and can only be remedied by talking together and meeting with Government to try and resolve the issues.
Rent levels on private sector leased properties are higher than properties that are let out so a delay in housing benefit payments has a high impact on the cash flow of Registered Social Landlord’s. It is important therefore to ensure that arrangements for payment of Housing Benefit are included in the framework document. In addition the rent to landlords has to be paid whether the Housing Benefit has been received or not so it is important that Registered Social Landlord’s get their Housing Benefit payments in on time, and tight management procedures by the Registered Social Landlord will help to avoid problems occurring.
Close management of rent arrears with early intervention and help with debt advice will also help to mitigate problems with cash flow.

Repairs

When an RSL has different leases in operation it is difficult to track the repairs on individual properties and to identify whether they are attributable to the landlord or to the RSL. This problem can be made more difficult if they are reported to a department that deals with both private sector leasing and standard social let properties. It is better to have dedicated staff to deal with private sector leasing so that the repair responsibilities can be assigned before they are carried out.

Rents

Information on the Local Reference Rents has been difficult to come by and clear, transparent information with regard to rents in an area from the Rent Service is not always available. It is anticipated that the introduction of Local Housing Allowances which is currently going through Parliament will ensure that information on rents is more readily available.

Recovery of Costs from Landlords

The RSL may incur costs for which the landlord is responsible. Landlords may dispute these charges and fail to pay them. Such disputes will be kept to a minimum if the repairing responsibilities are clearly identified within the lease.
Ideally the lease should state that charges for which the landlord is responsible can be deducted from on-going rent or charged as a debt.

Gas Safety Checks

Difficulties can occur where the landlord is responsible for gas checks and does not schedule the annual check to comply with legislation. It is simpler for an RSL to assume responsibility for this check and then reclaim the cost from the landlord if appropriate.

Documentation

All the documentation for the scheme needs to be clear and transparent so that all partners to the arrangement can see and understand what is expected of them.

Supporting People

People who have been homeless are often less able to maintain a tenancy and it is good practice to provide more intensive management for these people during the first few months of their tenancy. Supporting people may be able to provide some funds to enable this to happen, for example through Floating Support referrals.

Management Fees

Tight management and accounting procedures will highlight delays in management fees due from local authorities to RSL’s.
Rent arrears should be managed effectively to highlight delays in payment early.

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External Links

Supporting People – Essex
Supporting People – Suffolk
Swan Housing Group - Floating Support, Essex
Supporting People - Communities and Local Government