Press release Archives - Capital Letters

With the dissolution of Parliament before the General Election it looks like the Renters Reform Bill is now dead…

Months of campaigning work from across the housing sector has come to nothing… for now.

The message is clear, however, we have to remove the spectre of “Section 21” no-fault evictions.

“Section 21” evictions are the biggest cause of family homelessness – often resulting in a family finding themselves living in insecure, poor quality Temporary Accommodation, far from work, and schools, and support services.

Once a family is in Temporary Accommodation (TA) it can take years to find a new settled home. In the meantime education, work, health, and finances suffer… and society suffers.

TA is an expensive drain on the public purse, and whilst in TA many people stop being able to work and are forced to claim more benefits, so the associated benefits bill is increased and there is a reduction in tax paid. Because TA has an effect on health, people need the NHS more, and that adds more pressure to an already struggling system. Because children in TA miss more of their education, more interventions are needed, and there is a greater chance that they will have poorer education and therefore poorer employment outcomes – with less opportunity to contribute to society in the
long run…

A single “Section 21” eviction could cost society hundreds of thousands of pounds.

This is all without the moral question of “do we want a society where we let this happen?”

We urge parties of all sides to commit to scrapping “Section 21” no-fault evictions and as soon as possible.

Capital Letters, the independent commercial not-for-profit company owned by London boroughs and the registered housing charity Home Safe Housing are bringing up to 2,500 high quality affordable rental homes to London in a ground-breaking partnership.

There are over 60,000 households in London that are experiencing homelessness, and there has been a 70% increase in the number of families in Temporary Accommodation over the last 10 years. This is at a time when the number of new affordable homes being built is collapsing – there has been a year on year drop of 76% in the new homes being built by the Capital’s largest Housing Associations.

Against this backdrop Capital Letters and Home Safe Housing are finding new ways of bringing homes into the rental market, by delivering good quality affordable homes to tackle London’s housing crisis.

Each of the 2,500 homes will be refurbished by Home Safe Housing and brought up to Capital Letters Agreed Standard* and EPC C or above as part of its £750m investment.

The majority will be let at LHA rates to households in London who are experiencing homelessness, providing vital safe, secure, and affordable homes. The market rent properties will be offered on the open market; they will also be available to Capital Letters’ member boroughs, and they will be able to nominate working families who are experiencing homelessness for those homes.

“This partnership with Home Safe Housing is a great for London families,” said Capital Letters’ Chief Executive Sue Edmonds. “When Capital Letters was created, it was intended that the Company would be a landlord and with Home Safe Housing it can now successfully achieve its ambitions.”

“The focus in Capital Letters’ early years has been on successfully procuring nearly 6,500 homes for our member boroughs to use for homeless families who desperately need them. We achieved this success by working with individual landlords. Now the London rental market has changed so dramatically, we have focused our service on being a great landlord and providing these homes ourselves, which is a better way of meeting the increasing demand. This groundbreaking partnership with Home Safe Housing is the latest step in that strategy.”

The registered charity Home Safe Housing was conceived by Prowgress, a Hague based social impact fund and UK Structured Finance, a social investment banking boutique, to deliver affordable homes across England.

Home Safe Housing CEO, Jared Fox, said “We are delighted to be partnering with Capital Letters on this initial £750m investment in London’s social housing stock. As a not-for-profit company Capital Letters shares our social mission of alleviating homelessness and has the pedigree to ensure a robust and well governed project.”

“We know that together we can ensure the investment made will change lives for families in London, with thousands of homes being added to London’s affordable housing stock in perpetuity and that the project remains financially viable for investors.”

Sue Edmonds, Capital Letters CEO said, “Capital Letters exists to help alleviate homelessness and to provide increased value for money to the public purse. By partnering with Home Safe Housing and having a mixed economy portfolio, which includes market rent as well as Local Housing Allowance (LHA) rent homes, we can work together to support Capital Letters’ member boroughs, providing affordable housing to alleviate homelessness, built on a sustainable, financially viable independent business working with a like-minded ESG investment partner.”

The initial 2,500 properties will be procured over the next 2 – 3 years in a leasing deal that will run for the next 40 years with Capital Letters able to purchase some of the properties for £1 at the end of the period, ensuring that these homes will remain available to Londoners in perpetuity.

Paul Doe, Chair of Capital Letters Board of Directors, said “This deal shows the strength and ambition of Home Safe Housing and Capital Letters and the determination of both partners, to achieve their shared vision. This is what Capital Letters is for, to find ways to bring long term, good quality, affordable housing to Londoners in need whilst reducing the financial pressure on member boroughs.”

Cllr Meric Apak, Cabinet member for Better Homes, London Borough of Camden and Chair of the Capital Letters’ Boroughs Representative Body – the body that works with Capital Letters Board of Directors and Executive on behalf of the 10 Member Boroughs – said “This is the culmination of a lot of hard work and effort. To see it come to fruition is excellent, because this partnership between Capital Letters and Home Safe Housing means more affordable homes for people in need in London.”

*The Capital Letters Agreed Standard is a quality standard above Decent Homes Standard and is agreed by Capital Letter’s member boroughs. This is designed to raise the quality standard and safety of private rented homes across all London boroughs.

London accounts for 60% (56,500) of England’s households in temporary accommodation. Capital Letters and EVO share a mission to end homelessness.

Not-for-profit company Capital Letters has made a major move in its work to tackle the homelessness crisis by partnering with unique property maintenance company EVO Digital Technologies (EVO) to digitalise its repairs, maintenance and compliance services through a unique tenant-driven platform.

By automating a large part of the administration process related to the management of the repairs service through EVO with the confidence that tenants will benefit from an excellent and responsive service, Capital Letters can reinvest its time and resources into finding more homes for homeless families in London.

Capital Letters was established in 2019 in response to London’s homelessness crisis and mounting costs for councils. Funded by the Department for Levelling Up, Housing and Communities (DLUHC), the Company’s free service gives landlords easy and efficient access to suitable tenants across London whilst ensuring that properties meet required standards. By working in partnership with London boroughs and private landlords, Capital Letters has helped over 4,000 families find a secure home since they started three years ago.

In March 2022, DLUHC statistics show there were 56,500 households in Temporary Accommodation (TA) in London, representing 60% of the total across England. Of these, over 38,000 had children (68%). Capital Letters’ members expect this number to rise to 100,000 during the current financial year.

The company was created on a pan-London basis to enable boroughs to work collaboratively to combine resources, drive efficiency, equalise access and fair distribution of properties for members, reduce costs and competition for homes while increasing supply, support tenancies to be successful and deliver positive system change for London.

The partnership with EVO will allow Capital Letters to offer a holistic tenant focused housing management service, by using innovative and customer focused technology. This will empower tenants to arrange repairs at a time which suits them, rather than a contractor trying to meet arbitrary target dates.

“I am delighted that Capital Letters is partnering with Evo to provide a unique and innovative repairs service which puts tenants at the heart. Innovation is at the heart of what Capital letters does, driving change and creativity in everything we do. This partnership adds breadth and depth to the Company’s range of services as well supporting our primary objective of finding good quality, affordable secure homes so families can move out of temporary accommodation or avoid becoming homeless. Our partnership with EVO will allow us to add further value to our work with our member boroughs, increasing supply to address the homelessness crisis in London, driving up standards in the private rented sector and supporting successful tenancies for both landlords and tenants, ” says Sue Coulson, CEO of Capital Letters.

EVO is a fusion of property professionals, skilled trades and simple technology that transforms the way property management, maintenance and repairs are reported and delivered. Their digital platform connects tenants and landlords with skilled tradespeople in a convenient and transparent environment, allowing for issues to be resolved in the shortest possible time frame. This level of convenience allows issues to be raised and dealt with as they happen, ensuring tenants have a good experience, and landlords do not have a long term build-up of issues or consequential property damage.

“We are proud to embark on this journey with Capital Letters. EVO was born from a desire to improve tenant and landlord experience, as well as to tackle the serious problem of homelessness. I am really pleased that we have found a partner fully aligned with our core values and beliefs. Tenant experience seems to have been forgotten about in recent times but together I believe we can make a real difference” says Steven Rae, CEO of EVO.
By working with Evo, Capital Letters is confident that the Company will be able to deliver an excellent customer-focused repairs and maintenance service for their tenants, ensuring that the Company provides safe and secure homes where families can put down roots.

The main goals of the partnership are to:

Reduce homelessness
Ensure all accommodation is fully compliant
Ensure Capital Letters housing always meets the decent homes standard
Improve tenant experience with a completely transparent process, leading to increased engagement and satisfaction
Significantly reduce environmental impact through the use of digital solutions, video triage, local tradespeople and an improved first-time fix rate.
Build a useful property dataset to inform future investment decisions
Provide a seamless digital workflow for tenants, landlords and tradespeople.

EVO currently works with landlords, housing associations and local authorities as part of its shared mission to support people’s access to decent quality housing.

At Capital Letters, we are driven by a profound sense of purpose – to alleviate the suffering of families who find themselves without a place to call home.

Our commitment to supporting families experiencing homelessness is unwavering.

On this day dedicated to the awareness of the global homelessness crisis, we’re raising our voices to call for more homes and a rise in the Local Housing Allowance (LHA) rate.

Mark Lowe, our Director of Finance and Resources said, “There are almost 170,000 people living in Temporary Accommodation (TA) in London alone. These are the hidden homeless, families with a place to sleep but no home.”

Figures from London Councils suggest that in April this year the number of homeless families placed in bed and breakfast accommodation for longer than the six-week legal time limit increased by a shocking 781% – up from 146 in April 2022 to 1,287 in April 2023.

Mark continued, “This isn’t just a personal story of hardship for all the families in TA; it’s bad for society as a whole – children are missing school, people are losing jobs as they may have to accept accommodation hours from where they work, and the public purse is being squeezed as London boroughs are together spending at least £60 million a week on temporary accommodation costs. No one is free from the effects of this crisis, and we need a long-term solution.”

In our call for addressing the homelessness crisis, we support the widespread call for an increase in the Local Housing Allowance (LHA) rate. The LHA rate is a crucial lifeline for those reliant on benefits, enabling them to pay towards private rented homes. However, a freeze in LHA rates since 2020 has had a profound impact, leaving fewer than 2.6% of homes available at LHA rates, compared to a more equitable 30% before the pandemic struck.

“In a market like this we can’t just wait for LHA to be increased” said Mark Lowe “So we’re working with larger investment organisations, development partners, and our members, to take on portfolios of leases, offering some at market rent, which subsidises some at LHA rates. It needs to be financially viable for investors and we have a model that works.”

It’s important on World Homelessness Day to acknowledge the organisations that want to support Capital Letters, putting value back into society, helping those families have settled lives, making London a more vibrant city. It’s those organisations that understand that value extends beyond inflated profit margins and that it’s about making society better for everyone.

The Government has confirmed funding of £14.1m for Capital Letters for a further two years, showing its continuing commitment to tackling family homelessness in London and Capital Letters.

Eddie Hughes, Minister for Rough Sleeping and Housing, announced the grant renewal at a Capital Letters conference today (6 July 2022), when he underlined the not-for-profit company’s role in the government strategy to tackle family homelessness.

Around 4000 homeless families have found homes in the private rented sector through Capital Letters since it procured the first property three years ago.

By working collectively through Capital Letters, the member councils have access to more properties across London, enabling them to house more families and make savings on their homelessness costs. An independent review of Capital Letters by the London School of Economics in 2021 highlighted the £15,000 a year cost of maintaining a family in temporary accommodation.

Raising standards in the private rented sector

With social and affordable housing in short supply in London, councils have been finding an increasing proportion of the homes they need to house families in the private rented sector. Capital Letters ensures that these properties meet the quality and safety standards agreed by the councils, which will be essential after the decent homes standard applies to the private rented sector.

Sue Coulson, Chief Executive of Capital Letters, said:

“By working collectively with Capital Letters, our member councils are driving up standards in the PRS, reducing costs, and increasing the supply of affordable homes for homeless families across London. We are improving the experience for both tenants and landlords, with the private rented sector as a key element of members’ homelessness reduction strategies.”

“As more London councils join Capital Letters, collectively we have a greater influence on the housing market. Landlords have easy access to tenants from councils across London, while councils can significantly reduce the cost of homelessness provision. Together we are creating more opportunities for more families to move out of temporary accommodation and settle into a secure and safe home.”

Tenancy sustainment service supports new tenants

Capital Letters also provides a free tenancy sustainment service for both tenants and landlords to ensure the tenancy has the best chance of success, including helping with new benefit claims, setting up utilities and sign-posting households to other services.

Around 80% of the families housed in a property secured through Capital Letters accept the offer of support; in 2021/22 the company secured over £750,000 for 300 families through grants and back-dated benefits.

Capital Letters is now developing new services to increase housing supply and making letting to families referred by councils more attractive to private landlords. Planned services include rent collection and protection, bonds and property management, which reduces the risk of arrears and reassures landlords that their property is looked after.

The company is developing independent sources of income to replace the current grant when it ceases in 2024 to ensure that services for homeless families continue long-term. Capital Letters is negotiating with property portfolio investors and intends to become a landlord itself, supplying more PRS properties for member boroughs.

Cllr Darren Rodwell, Executive Member for Regeneration, Housing & Planning at London Councils, said:

“Capital Letters is a crucial part of boroughs’ pan-London approach to tackling the homelessness crisis.

“Since its launch, Capital Letters has improved boroughs’ access to accommodation options and – most importantly – secured better outcomes for the homeless Londoners who rely on us for housing help.

“We’re pleased the government is continuing its funding support for Capital Letters. This is important recognition of Capital Letters’ impact and a valuable boost to boroughs’ collaborative work in support of homeless Londoners.”