Social letting agencies play a vital role

A new report, Scaling up social lettings? Scope, impact and barriers reveals that social lettings agencies play a vital role in supporting low income and vulnerable people living in the private rented sector.

The research was jointly funded by the Joseph Rowntree Foundation and the Nationwide Foundation. Together we commissioned research to explore the current and future role of social lettings agencies to help improve the experiences of people in need in the private rented sector.

In the final report, six case studies were used to represent the varied challenges and opportunities that different housing market contexts and operating models present. In general, social lettings agencies are playing a vital role in helping low-income or vulnerable groups in four important respects:
• access: they are helping tenants to access accommodation not otherwise available to them
• affordability: they make rents more affordable to tenants
• conditions: they have a set of minimum standards for properties they let
• stability: tenants feel more settled and ‘at home’ after accessing accommodation through the social lettings agency.

Several benefits to landlords emerged from the case studies, including guaranteed rents, more active property management and satisfaction that properties are being let ethically.

In conclusion, the researchers found that social lettings agencies have several strengths, as they:
• can draw on a range of different funding sources
• could help local authorities to discharge their obligations under the Homelessness Reduction Act 2017
• can enable better use of stock where there are empty properties
• might be able to acquire their own property portfolios
• can cross-subsidise support for low-income or vulnerable tenants from commercial activity.

Some of the key barriers to the scaling up of the social lettings agency model are:
• the gap between Local Housing Allowance rates and market rents, which has a major impact on social lettings agencies’ ability to attract landlords
• ongoing welfare reforms, with particular concerns about the roll-out of Universal Credit
• the geographic specificity of the private rented sector, which makes it difficult to scale out existing schemes across neighbouring areas
• the distinctive mix of skills required to set up and develop an social lettings agency.

Social lettings agencies have the potential to improve housing outcomes for low-income or vulnerable tenants while also offering a positive option for landlords. At present, the overall size of social lettings agencies – individually and collectively − is small, and social lettings agencies are not yet a substitute for systemic reform of the private rented sector. However, social lettings agencies could make a considerable difference to the options available to specific groups, particularly homeless people.