Initiative to help house homeless Londoners delivers early successes

By Ann Edge and Christine Whitehead | 17 November 2021

The sheer scale of London’s homelessness problem means that very different solutions are necessary compared to the rest of the country.  Over 60% of the nearly 100,000 households in temporary accommodation in England are Londoners. And over 60% of those households are families with children. 

The main reason for these very large numbers in temporary accommodation is not so much how many households are accepted but how long it takes to move them on to more secure accommodation - as a result the average length of stay in temporary accommodation is more than double that seen elsewhere in the country – and costs are a lot more than double.

In London the turnover in social rented housing is very limited so the vast majority of those accepted as homeless have to be accommodated in the private rented sector.  Boroughs are often dependent on nightly paid accommodation, including bed and breakfast. Families have no real place to call home, they may be moved from one place to another and have little feeling of security – not just about their accommodation but also their children’s schools or even access to where they work.  But the shortage of affordable properties for temporary accommodation also means that boroughs have often competed with one another for the same accommodation.

In 2018, the Homelessness Reduction Act extended borough powers to help prevent homelessness, opening up new ways to approach the homelessness problem and requiring boroughs to support more types of household. In the face of these challenges, Capital Letters was set up in 2019 by a group of London councils to work in a new way –in conjunction with member boroughs whose responsibility it remains to accommodate homeless households and those at risk of homelessness. 

LSE London were asked to take an independent review of how Capital Letters has developed since 2019: their challenges and successes.

The core of the Capital Letters approach is to procure suitable privately rented accommodation not as temporary accommodation but as two year Assured Shorthold Tenancies (ASTs) at rents which a family can afford and, where possible, close to where the family was living before they ran into problems. Once settled in their rented home, Capital Letters provides a tenancy sustainability service to support both tenants and landlords.

Early successes have included:

  • Putting in place a more effective agreement between the 21 member boroughs to standardise pan-London incentive payments for PRS landlords. This has significantly reduced inter-borough competition and helped to stabilise rents;
  • A pan-London property standard which Capital Letters argues ‘has improved the consistency, safety and quality of accommodation offered to homeless families’; and
  • Establishing the tenancy sustainment service.

Initially the procurement of properties suitable for the two-year ASTs tenancies which enable boroughs to discharge their homelessness duties was slower than planned for reasons mainly outside of Capital Letters’ control.  However, in the year from March 2020 to February 2021 it was able to offer almost 4,000 properties - significantly increasing the numbers of ASTs used to accommodate homeless families in London.

Since then progress has been rapid. In the six months from March 1st 2021 to August 31st 2021 the numbers of properties offered was close to the numbers for the full year before.   

Moreover, to date, 67% of families have been housed in-borough compared to the all London figure of 41% -  reducing the tension between boroughs who would otherwise place their families in properties in cheaper boroughs.

Many of the boroughs recognise AST accommodation as a particularly suitable means of addressing their prevention duty, as it has the potential to ensure that people do not experience the problems associated with temporary accommodation.   Maintaining tenancies for at least the full two years helps to make sure households do not re-enter the homelessness process.

But it can also meet the housing needs of families who have been in temporary accommodation for years – as long as the property to which they move is affordable.  The potential to help this group of households could be enhanced if boroughs are prepared to allow people accommodated in this way to remain on their waiting list without loss of priority.

If Capital Letters can fulfil its aim of providing a central point for negotiations with landlords and agents, it should be able to continue to reduce costs and further increase supply.  There is thus real potential to grow the approach so that many fewer London households remain in unsuitable and expensive temporary accommodation.

Christine Whitehead is deputy directory and Ann Edge is an independent researcher at LSE London


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