Like many landlords, our local authority client was facing a number of significant challenges including, but not limited to:
However, their ability to deliver on the above was being severely constrained due to considerable financial pressure, both within the HRA and more generally across the Council. It is fair to say that the Council had exhausted their prudential borrowing capacity.
Andrea Paterson was commissioned in 2015 to assess the financial performance and long term sustainability of the Council’s housing stock and to work with the Council to establish ways in which additional financial value could be created to fund other investment. This involved a comprehensive strategic appraisal of the financial performance and longer term sustainability of the Council’s housing portfolio of more than 20,000 units. This was completed at a detailed level to ensure the Council had maximum visibility of the varying performance of the different property types, sizes and location of its stock. It also included identifying those issues eroding financial value in the HRA and, perhaps more importantly, appraising the impact of a range of ‘corrective’ actions and other options available to the Council to improve the financial performance and sustainability of the stock.
The Council now has a detailed understanding of the performance of all of its housing stock and ways in which financial value can be created within the strategic planning environment to fund other investment. The Council is now able to identify those units which positively contributing to the HRA and those which do not. This increased visibility and shared understanding enables the Council to better assess the likely impact of corrective action or different approaches to managing and maintaining its stock.
Andrea Paterson is working with the Council on Phase 2 to develop a developing a fully resourced and funded strategy for the long term investment in their existing housing stock and new housing supply.