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Opinion: The inconvenient truth – quality of tenant data is average at best

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Opinion: The inconvenient truth – quality of tenant data is average at best

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Published by Max Salsbury for 24dash.com in Housing

Opinion: The inconvenient truth  quality of tenant data is average at best Opinion: The inconvenient truth quality of tenant data is average at best

By Richard Blundell, CEO of Housing Partners Ltd

Social housing has never been at the forefront of technology, and arguably has never needed to be. But as we head into a new era of welfare reform, landlords must make wholesale changes to the way they capture information on their tenants or face severe financial consequences.

We know that the data social landlords’ hold about their tenants is often poor. Every other commercial sector in the UK has spent millions on customer profiling and ‘know your customer’ is one of the first rules of business.

Yet it’s clear from the work we’ve done with dozens of RPs recently that the social housing sector’s understanding and insights into its tenants is extremely poor.

Historically, up to 70% of registered providers’ revenues were received in housing benefit, meaning there was never any need for landlords to know who was living in their homes. Under occupancy was also never a problem before the implementation of the Welfare Reform Act 2012 and homes were granted to individuals and families regardless of size.

But with these changes coming into force, the effects of bad data will become increasingly damaging.

Rent arrears and void costs are on the rise and over the next few years, more and more tenants will begin to receive their benefits directly from the government, making rent collection a real issue. Evidence suggests for example that landlords have a worryingly low level of Direct Debits set up with their customers for example. The risks to registered providers’ revenues have never been greater.

Landlords are collectively spending a ridiculously high £2 billion a year on IT services, according to a report by Tribal Group/Housemark in 2011. Even a small Landlord can spend as much as a million pounds a year on IT all in.

However, the technology platforms they are using are extremely expensive to manage, procured on very long contracts and ultimately out of date and not fit for purpose. Communications channels between landlord and tenant are often poor and there are no provisions for keeping data up-to-date. Therefore, the data will never get any better unless dramatic steps are taken.

It has to be time now for landlords to call time on their existing IT providers and demand better and more cost efficient, fully mobile services. With universal credit and direct payment fast approaching housing providers will be exposed to the greatest threat to their income yet.

The good news is these new technology platforms are now available. At Housing Partners for example, we have recently developed a new service called 'Who’s Home', a secure cloud-based profiling service that allows landlords to quickly identify the occupants of every property they manage. Who’s Home allows you to predictively model rental risk within your housing stock, giving you the insight you need to uncover and manage threat in the wake of welfare reform.

Social housing professionals are not data analysts. They don’t have the know-how and resources to mine massive amounts of data – and why should they? Housing officers came in to the sector to help others and are already extremely overstretched with existing workloads. They need specialist help and systems that support them in making the most of the vital resource that their data is.

Improving tenant data is not a luxury for landlords, but is an essential task for the immediate future. By protecting incomes and reducing rent and void risks, registered providers can make the kind of savings that could make a real difference elsewhere – like in building much needed new homes.

When it comes to renewing your HMS, CRM or AMS just pause for a second and consider whether these platforms are still fit for purpose. Our feeling is they are not and it’s time to change.

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