A Quick Guide to Asset Management in Social Housing

A Quick Guide to Asset Management in Social Housing

Chances are if you work in social housing, you’ve heard about the ramp-up in asset management. During a recent webinar run by the ICSH, they outlined the importance of proper management of assets and what is to be expected in the near future. With that in mind, we thought we’d have a little go at pulling together some info on the subject.

What is asset management?

Most companies or organisations have assets, few as substantial as those in social housing and every company needs to manage their assets as best they can. In many private sector firms, current and non-current assets make up a massive part of the company’s financial evaluation.

In short, asset management is extremely important. Assets are defined as anything of value that could be converted into cash. The AHB’s main assets are their homes, though in truth these assets are all themselves filled with lots of other assets. The kitchen appliances, the doors, the toilet and the house itself are all assets. Already, the circulation of stock condition surveys to assess the current state of the units is a key activity for any AHB.

The carrying out of these checks allow the AHB’s to plan for the future, procure correct quantities, maintain their properties, provide the best possible service to their tenants and secure future investment.

Whether there has been a formal or strategic plan put in place, everyone in the sector engages in asset management every time they schedule a repair or carry out an inspection. However, as the regulation surrounding the management of assets in the Irish social housing sector increases, more and more conversations arise about how to do it properly and with a strategic plan in place.

Why is it needed?

Again, just like any organisation, planning for the future is extremely important. We’ve briefly touched on what the proper management of assets means for the org but let us go a little deeper. The regular assessment of stock, through surveys and inspections allows for AHBs to forecast maintenance activities, both cyclical and planned, while also improving the org’s financial forecasting. Improving performance in these activities will allow the AHBs to improve on perhaps their most vital activity, delivering a tenant-focused service.

The aim of the increased regulation is not to hinder but to help the AHBs.

The ability to properly forecast and plan for the future shall provide the AHBs with an increased ability to budget and plan. All in all, they will be able to maintain a steady stream of well-maintained and affordable units to the tenant. The ability to provide value for money to all service users requires careful consideration during all activities. Proper asset management will have a notable impact on all activities, in particular, procurement.

Recently we wrote a piece on the reclassification of AHBs and the role of vulture funds in the sector, it might seem unrelated but a well maintained and accurate asset register will allow potential investors to evaluate an AHB’s net present value. In addition to this, as we mentioned, it will give potential investors a clearer picture of future costs the org is likely to incur. This will allow them to make more informed investment decisions and may mean an increased likelihood of securing investments within the sector.

How to manage it

The regulator promotes a “holistic approach” to asset management. Like all things in the sector, they promote an approach that reflects the org’s own size, vision and mission. Being aware of the individual demands of your tier and subsequent housing stock is a must. Having an idea of your own stock and likely costs of maintenance, informed by stock surveys and regular inspections, will form the basis of your asset management strategy. The strategy should be informed by growth targets (set out in your vision statement) and service delivery objectives. How to practically manage this is another question.

First of all, having systems currently in place that help you track maintenance and financials is a must as these will form much of your assumptions going forward. Systems that allow you to organise and track maintenance while also circulating stock condition surveys and circulars will be invaluable to forming the basis of your asset management strategy.

Ideally, you would have this info linked to your asset management software or vice-versa. Although, few exist and of these few, none are likely to have the nuances of the regulator’s demands built-in. That is why we have begun the process of collating data to build our own asset register into the Affinity system. Like all things Affinity, this new feature will be constructed through an ongoing and extensive dialogue with industry stakeholders.

If you work in an AHB or are a stakeholder of the sector, let us know your thoughts about asset management – email us at sales@usetilt.com.

 

Photo by energepic.com from Pexels
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