Local Space: “Improving thermal efficiency is the best thing we can do to help”

 

Funded partially from Right-to-Buy receipts and partially from their debt portfolio, Local Space tends to buy and refurbish homes on the open market, rather than build. One of the advantages is the speed of turnaround: Parsons says they aim to refurbish and rent the properties within 16 weeks, and often manage a quicker turnaround than that.

 

As for the rent, their properties are classed as intermediate: “The rent level is pitched in between social rent and market housing levels,” says Parsons. “That means we can support a higher debt burden while our housing is valued at the market rate.

 

Primarily based in the East End of London, Parsons says the need is sufficient in London that they’re not looking to expand beyond the capital at this time. “The values of properties in London haven’t gone down as they might have done in other areas, and that supports our business model and our borrowing.”

 

“We’ve grown by 900 homes from a base of 2,300 just three or four years ago, and while 3,000 homes is not massive in social housing, that’s significant growth.” And with the increase in energy and food prices, the homelessness crisis is growing, too. “Homelessness is not going away, and the pressure on people’s household budgets isn’t going anywhere but upwards.”

 

Local Space tends to buy and refurbish homes on the open market, rather than build. One of the advantages is the speed of turnaround: Parsons says they aim to refurbish and rent the properties within 16 weeks

“The cost-of-living crisis is going to affect everybody, irrespective of your level of income, but when you’re talking about a doubling in the cost of energy to heat your home and hot water, that’s obviously going to affect people on a lower income much more as a proportion of what they earn.”

 

The rise in gas heating bills prompted Local Space to invest in a pilot programme of refurbishment to determine the best way to retrofit their properties. “We are improving the thermal efficiency of some typical homes that we own. These are not brand-new properties and not fancy properties, but rather the kind of archetypal properties that exist across London.”

 

The homes will be refurbished to an EPC A or higher standard of energy efficiency. “That’s the best thing that we can do to help people afford to run their homes in the longer term with energy costs rising.”

 

After the pilot programme, Local Space will assess the feasibility of retrofitting properties without moving families out. Their hope is to reduce the cost of heating to the extent that a tenant might only need to pay for hot water.

 

On hidden homelessness: “You would be surprised at how many people are living in their car”

 

Local Space has also set money aside for a hardship fund this year, to support tenants in the short term. “They might struggle for a lot of reasons… for example, if they are in the early stages of a benefit claim. A five-week wait is not unusual. What do you live on in the meantime?”

 

Parsons says it makes her “extremely sad” when she hears the stories of families living in terrible conditions. “We know that people who grow up in insecure housing do not do well in life,” says Parsons. “You would be surprised at how many people are living in their car.”

 

Parsons would like to see a regulatory approach that ensures a minimum standard is applied to private rented accommodation. “These private homes are being funded by the benefit system at least in part, but there isn’t a requirement to assess the standard before housing benefit is paid.”

 

“Social housing is held to quite a high standard, but there isn’t any regulation in the private sector at all, with the exception of the requirement to service a gas boiler.”

 

Parsons also mentions the lack of minimum space standards, “There are homes in the private sector that are so tiny, we should not be housing families in these accommodations.”

 

“We have space standards to meet as a social housing provider, but people who are renting through the private sector are accepting standards that are inadequate because they have nowhere else to go.”

 

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