Increased spending of housing associations due to welfare reform
- 16 Jan
In some parts of England, housing associations have been forced to spend more on repairs and maintenance.
This was to encourage new tenants to move into larger homes due to the government's welfare reforms.
Inside Housing carried out an analysis of 100 of the largest housing associations' annual financial statements. These had shown that there was an increase from £2.38bn in 2012/13 to £2.48bn in 2013/14.
Knowsley Housing Trust (KHT) reported its spending increased from £3m to £17.9m in 2013/14. It was mentioned by a spokesperson that this rise was due to the number of empty homes significantly increasing as a result of bedroom tax. It was also because of the expenditure on improving the conditions of these homes. He further stated, "The reduction [in empties] that we achieved was largely due to our improved specification, which included fitting carpets and blinds, and because we now promote our empty homes to a wider audience".
In March 2013, there were 490 empty homes, which increased to 604 in June 2013 and then fell back to 346 in March 2014.
Helena Partnerships, based in St Helens, Merseyside, also experienced a similar increase as their routine maintenance increased from £1m to £6.2m in 2013/14 which was ‘due to an increase in the number of properties becoming void and an increase in void unit cost' due to welfare reforms.
Jephson Homes Housing Association's routine maintenance spending increased from £12.6m to £13.7m. It stated that some of this was to do with welfare reform and that it carried out extra work ‘to increase lettability'.
Aspire Group, based in Staffordshire, said its routine maintenance costs increased by 5.8% per home and that the bedroom tax had ‘significantly increased the cost of void repairs'.
Bradford-based Incommunities' routine maintenance costs had risen by £1.3m due to high levels of void turnover caused in part by welfare reform.
Sunderland-based Gentoo reported a 21% rise in void property turnover due to welfare reforms.
The increased spending for many housing associations meant they took note when former housing minister Kris Hopkins advised in 2013 that landlords ‘need to be creative to make sure all of those homes are utilised'.
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