Margaret Sharkey: The Scottish Housing Regulator’s latest meeting with urban landlords

Margaret Sharkey: The Scottish Housing Regulator's latest meeting with urban landlords

The Scottish Housing Regulator’s assistant director (governance and performance) Margaret Sharkey details the latest meeting of the Urban Landlord Group.

We had another of our regular meetings with one of the three standing groups of senior people from Registered Social Landlords to discuss important and topical issues in social housing in Scotland. We meet with the groups to help us understand the challenges faced by those we regulate. We plan to refresh the membership of the groups after a year or two to give other landlords the opportunity to engage with us in this way. When we are refreshing the groups we’ll ask for volunteers but in the meantime please let us know if you are interested in being part of the groups please let us know.

At the end of November 2023, we met the group which brings together senior leaders from RSLs based principally in urban areas. It was a wide-ranging and useful discussion, here are the main points we touched on.

The main focus of the discussion was rent setting and the uncertainties and challenging context for landlords when making decisions about future rents.

Landlords highlighted the need for greater certainty on the Energy Efficiency Standard for Social Housing (EESSH) to allow them to plan for the future – this meeting happened just before the Scottish Government published its consultation on the Social Housing Net Zero Standard. Landlords also highlighted the need for greater clarity about funding and technologies which would support them to deliver on net zero targets. Landlords talked about the particular challenges facing those with pre-1919 tenements in terms of the cost-effectiveness of new heating systems. Landlords with pre-1919 tenements also spoke about the fabric-first work they were doing and the high costs involved. Landlords gave feedback on their experience of pilots of new heating systems to deliver on net zero and the support they are providing to tenants who have found the new heating systems more complicated to use.

Landlords called for policymakers to have a deeper appreciation of the long-term nature of their businesses and the long-term planning which is required to deliver on significant changes – such as net zero – and ensure business plans remained sustainable.

The conversation moved on to measuring affordability and landlords suggested it would be helpful to move away from a focus on affordability to focus more on value for money and the added benefits to tenants. Looking at rent in isolation doesn’t take into account whole house costs, fuel poverty or the other services landlords provide. It was also noted that calculating whole house costs recognises that it is not just rent to be considered when looking at costs to tenants. Participants flagged the work being carried out by Scotland’s Housing Network to develop indicators on value for money.

There was a general consensus that the challenges for landlords are not diminishing. Even though inflation is coming down landlords are continuing to experience high costs such as insurance and investment and repairs costs which are well over the headline rate of inflation. This will impact on planned rent increases and is likely to result in planned rent increases which are higher than the rate of inflation. Participants discussed the importance of telling the story of the range of work they do when consulting tenants about rent increases.

The meeting ended with an agreement to meet again in the spring and discuss EESSH.

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