The property legal thread: are you building on strong and accurate foundations?

Support strategic growth and development

Investment must be in the right place at the right time. With a thread that provides a holistic overview, housing associations can make well-informed decisions on investments in maintenance, development and redevelopment, and unlock partnership opportunities. 

Build trust with stakeholders

Insurers require robust assurance and their requests for data on properties are increasing. This includes more than construction type, age, condition, restrictions etc, for example providing evidence as to who is responsible for insuring the building (where the housing association owns a leasehold interest). This thread must provide robust assurance to third-party stakeholders and investors.

Increase the ‘ready-to-go’ pool of properties to secure against loans/bonds

The sector relies heavily on secured funding, so having properties ready for charging is crucial to delivering new homes. Reasons some properties may not be acceptable can include short lease terms, unregistered land, title restrictions, missing documentation etc. A property legal thread can support identification of issues proactively that will assist in resolution/rectification and can often help to avoid high legal costs.

Understand and manage the secured properties pool

Having an accurate, up-to-date, reliable and detailed understanding of the secured properties pool and its potential can unlock additional security and borrowing value. For example, historic charges that can be released, security uplift projects and uncharged properties that can be used to secure new borrowing.

Loan covenant compliance

Increased property data requirements have grown to now include valuer rotation, which adds yet another batch of data that needs to be held and monitored by housing associations. This becomes significantly more streamlined with a thread that includes these datasets.

When it comes to optimising potential borrowing value/releasing equity, whether these are new or existing shared ownership homes, there is value in the equity retained by the housing association. This can unlock more than just the usual restrictions that come with traditional borrowing, when considering strategic opportunities, such as shared ownership portfolios.

Best practice for capturing documents and data

1. Collaboration and awareness

Collaboration and awareness are key, and not just within each organisation but also sector-wide, working together to share ideas.

• Close collaboration between internal teams is fundamental in understanding the impact the data thread has across the organisation; it will also assist in securing a “single version of the truth” and breaking down silos.
• Joining external working groups such as the Legal Treasury Group and the Assets and Liabilities Group can also be helpful. These groups exemplify how collaboration benefits the wider sector, bringing together housing associations to share experiences and work together to streamline processes and create efficiencies.

2. Standardise documentation processes

Standardising documentation processes across the organisation helps to ensure consistency and accuracy in property legal data and document management. Key steps include:

• Developing processes and procedures: collaborate to standardise templates and guidance to optimise outcomes.
• Training staff: provide training for staff to raise awareness of the importance of these data and document standards.
• Regular audits: conduct regular audits of the data and document processes to identify gaps or discrepancies, make necessary improvements and carry out lessons learned sessions.

3. Foster a culture of compliance and accountability

Building a robust legal and document thread that compiles the granular detail of the property portfolio requires a commitment to compliance and accountability at all levels of the organisation. This can be achieved by:

• Leadership commitment: board and executive teams should commit to property legal data capture, management, and compliance – ensuring that this is not overlooked and underestimated.
• Employee engagement: foster a culture of compliance by engaging employees in training and awareness programmes related to property legal data and document management.
• Performance metrics: implement performance metrics related to data and document management / compliance to track progress and identify areas for improvement.

4. Leverage technology and innovation

Embracing technology and innovation can enhance property legal data management. Consider the following:

• Digital transformation: many housing associations are on a data strategy journey; the property legal thread must form part of this.
• Data analytics: there are opportunities to use data analytics tools to gain insights from legal data, such as identifying trends in maintenance needs, strengthening communities and customer satisfaction etc.

The property legal thread is not merely a bureaucratic necessity but a strategic imperative.

These elements enable housing providers to maintain compliance, manage risks and ensure long-term sustainability and success in their mission to provide safe and affordable homes.

Keely Henderson is head of treasury – property at The Riverside Group; chair of the Legal Treasury Group and chair of the Assets and Liabilities Group. Yogeta Partridge is founder and director at Rydeo Consulting