Community Investment and Bottom Line

Housing providers’ community investment activity has the potential to create benefits in a range of ways. Alongside the benefits to the individual tenants and residents who participate, other impacts could include savings to local or national government, or financial savings to the housing provider. This project analysed data from six housing associations to examine the relationships between community investment and organisations’ bottom line costs.

Community investment has often been at the heart of housing associations’ activity as an expression of their social purpose – supporting tenants to live successful lives in vibrant neighbourhoods and improving opportunities for tenants and residents. With community investment spend coming under increasing scrutiny, there has been more pressure than ever before to demonstrate the value of this activity.

While the benefits of these activities both to individuals and to communities is widely recognised, common sense dictates that there are several ways that community investment activity may also reduce costs to the business bottom line. However, there had been few previous cohesive attempts to quantify the extent to which community investment activity is actually associated with lower costs in other parts of housing providers’ businesses.

This project used advanced data science methods – known as propensity score matching – to ensure that like-for-like comparisons were made between the people in different categories. Individual analysis was conducted for each housing association, producing results that identify the relationships between different statuses and costs per tenancy.

There are several key findings, based on the data available:

  • Tenancies classified as in full time employment are likely to have between 16-34% lower responsive repair costs, compared to tenancies not in employment (using full housing benefit as a proxy);
  • Tenancies classified as receiving partial housing benefit are likely to have between 9-30% lower responsive repair costs, compared to tenancies on full housing benefit;
  • 31% of tenancies examined can be considered unemployed / inactive and another 11% are in part time employment.[1]

Based on these figures, if the differences in repair costs observed in this study were extrapolated across the sector, approximately £130 million per year more is being spent on repairs than would be if we were able to move these households into full time employment.

This research is a significant first step in demonstrating the direct business benefits of community investment activity and, when used in conjunction with a holistic analysis of the wider benefits to individuals and communities, represents another angle in understanding ‘impact.’

These analytical methods also have potential to unlock further insights around different activities. HACT welcomes discussions with housing associations that would like to explore use of these methods in their own businesses.

 

This research was co-funded by project participants: Bracknell Forest Homes; Gentoo; Helena; Hyde; Knightstone; and Liverpool Mutual Homes.

The report on this work, with additional findings, is now available to access.

Community Investment and Bottom Line - Full Report (PDF)

 

[1] Source: English Housing Survey Headline Report 2014-15 Section 1: Tables, Figures and Annex Tables (AT1.3): https://www.gov.uk/government/statistics/english-housing-survey-2014-to-2015-headline-report

Project update blogs

Community Investment and the Bottom Line: project update 1

by Phil Goddard (15 July 2015)