Why are so many housing associations turning their backs on fixed-term tenancies?
In 2011 the Localism Act gave social landlords the option to issue fixed-term tenancies for the first time. However, a growing number of housing associations are now opting for a return to the lifetime tenancies of the past. Rhiannon Curry investigates the reasons for this change in approach. Picture by Getty
When the government legislated to allow housing associations and local authorities to offer fixed-term tenancies to social housing tenants in 2011, there were widespread misgivings about what the policy would mean for residents.
Lifetime tenancies had been one of the central tenets of social housing: giving people a secure, safe and stable place that they can call home for their whole lives.
The coalition government of the day called the new contracts ‘flexible tenancies’: the result was that people’s right to a social home would be reviewed at the end of a set term, with the potential for a person to be evicted if they were found to no longer need it.
The change was drive by a perceived unfairness by the then-government. This was reflected in the language of the Localism Act which drove the change. “People acquire a social home at a moment of crisis in their life, and continue to live there long after their need for it has passed. Meanwhile, there are people waiting for a social home who face much more difficult circumstances,” it read.
“This is unfair, and represents a poor use of valuable public resources.”
And although it was up to individual landlords to decide whether they wanted to implement the policy, many did, arguing that it enabled them to use their stock more efficiently and review the needs of tenants more often.
But recent events have suggested that the tide may be turning on this reasoning; it is beginning to look as if fixed-term tenancies have had their day.
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A recent Inside Housing survey revealed that a number of large housing associations have decided to scrap them altogether, moving tenants onto lifetime tenancies, while others have put their tenancy policies under review (see table).
Most of them cited anxiety among tenants and extra work for frontline staff as the reason why they had scrapped or were considering scrapping the policy.
“We know customers feel insecure when they hold fixed-term tenancies which impact on their overall well-being,” says Alex Nagle, head of operations at Vivid, an affordable housing provider in Hampshire.
The housing association is currently reviewing its position on fixed-term tenancies, she says.
It is a similar story at Bath-based Curo Group: “Feedback from customers is that they don’t really understand fixed-term tenancies, can find it difficult to exchange their home and are reluctant to decorate or fully furnish their home,” a spokesperson for the company says.
“They are causing some customers a lot of anxiety. We have found the process of reviewing tenancies at the five-year point useful though, and have picked up a number of support cases and other issues that need addressing.
“So we are considering audits every five years as an alternative. The customer engagement the process requires has been worthwhile, and we wish to keep that benefit.”
Even though a number of housing associations are moving to offer longer tenancies, housing charity Shelter still believes there is more to do: it is calling on the government to increase tenure security across both social and private housing by introducing new legislation that protects families from “the repeated risk of homelessness”.
Polly Neate, its chief executive, says: “The stress and instability caused by losing your home is awful for anyone. That’s why any move by social landlords to ditch fixed-term tenancies and instead offer tenants genuinely secure homes must be welcomed.”
Having the security of a home that you know you’re going to be able to stay in long-term is “absolutely fundamental to living a good life”, she explains.
“It also simplifies the lettings process for landlords and crucially supports the development of strong and sustainable communities.”
Since her comments, the government has announced it is looking to scrap ‘no-fault’ evictions in the private rental sector, to give tenants more certainty over tenure.
A number of landlords thought that lifetime tenancies helped bond communities together.
A spokesperson for Stafford and Rural Homes, which scrapped the policy in May last year says: “Feedback from customers has been positive, with people recognising the opportunity to have a home for life and commenting on how it will lead to greater pride in people’s homes and communities.”
But there are some who argue that fixed-term tenancies still have a place and actually help landlords to manage their communities and people’s housing needs better.
Jo Barrett, operations director at Thrive Homes, says the organisation likes its system of offering seven-year tenancies, which it introduced in 2012.
Housing associations’ policies on fixed-term tenancies
| Reviewing use of fixed-term tenancies | Fixed-term tenancies only on larger homes | Totally scrapped |
|---|---|---|
| Hastoe | LiveWest | Thirteen |
| Network | Midland Heart | Optivo |
| Radian | Stafford and Rural Homes | |
| CHP | L&Q | |
| Clarion | Sanctuary | |
| Housing Plus | Peabody | |
| Orbit | ||
| Sovereign | ||
| Curo | ||
| One Vision/Pine Court | ||
| Vivid | ||
| Anonymous HA* |
Source: Inside Housing research. Note: *This housing association did not want to disclose its name
“We are able to make best use of our assets and have the opportunity if at the end of the tenancy people’s circumstances have changed, we can have a conversation about what is best for them,” she says.
Thrive, which has 4,000 rented and leasehold properties in Hertfordshire, Bedfordshire and Buckinghamshire, has recently implemented a system which means it pays an annual visit to tenants to check the condition of their homes and to see how residents are doing. Ms Barrett says the tenancy plan fits into this without causing more work for staff.
“It gives us a natural break to talk to tenants about downsizing – and we’ve found incentives to do this don’t really work,” she says. Encouraging tenants whose children might have left home to move into a smaller property helps free up larger homes for families, she points out.
LiveWest has also recently reviewed its tenancies, and has decided to keep seven-year fixed terms for three-bedroom and larger homes, but have lifetime tenancies for one and two-bedroom properties, enabling it to similarly move people if they are under-occupying larger homes.
Midland Heart had initially offered fixed-term tenancies on all of its homes, but as Gary Hardy, director of housing operations, explains, it has recently changed its model.
“We offer lifetime tenancies on one to three-bedroom general needs properties, following an initial one-year starter tenancy for new customers, and six-year fixed-term tenancies on properties with four bedrooms or more,” he says.
“Having looked at various factors, we decided fixed-term tenancies probably weren’t ideal for everyone, so we began looking at where we had turnover [of homes] and where our most valuable homes were.”
“[A lifetime tenancy] simplifies the lettings process and supports the development of strong communities”
In some cases, tenants initially wanted fixed terms on their tenancies. Stafford-based Housing Plus Group says it initially introduced fixed-term tenancies with the support of tenants who understood that they had the potential to help the housing association manage its stock.
“Fixed-term tenancies can increase opportunities for customers to move home when their needs change. There is a shortage of affordable homes where we operate, and this is just one way which can help ensure homes are allocated appropriately to meet a range of customers’ needs,” a spokesperson for the organisation explains.
But they also confirmed that Housing Plus is now reviewing its position – and could follow others in scrapping the policy in the future.
In many cases, the nature of the tenants housed in properties was a key consideration when deciding whether to implement fixed-term tenancies in the first place.
Richard Keeley, housing and customer engagement manager at the ExtraCare Charitable Trust, says: “We have never introduced fixed-term tenancies; we only offer permanent tenancies. This decision is based on our customer group, which is exclusively older people.
“We do not feel it is appropriate to offer fixed-term tenancies to our customers who want security of tenure later in life.”
Similarly, Accord Housing Association said it felt lifetime tenancies best supported its ambition to build “loyalty, trust and pride in homes, and a sense of community”, and so had never introduced fixed-term tenancies.
Although there are some benefits, particularly in areas where larger family homes are in short supply, the era of widespread fixed-term tenancies for all social housing residents seems to be coming to an end.
Far from David Cameron’s ideal of creating more fairness in the system, some say they undermine cohesive communities and place a greater burden on housing association staff to regularly police the individual needs of their residents.
The argument for keeping them comes down to an issue of need and deciding whether letting people stay in their homes is more important than moving them to one that is the right size.
