Decision

Current regulatory judgement: Home Group Limited (27 March 2024)

Updated 27 March 2024

Applies to England

RSH Narrative Regulatory Judgement

• Provider: Home Group Limited
• Regulatory code: L3076
• Publication date: 27 March 2024
• Governance grade: G1
• Viability grade: V2
• Reason for publication: Changed basis for viability grade
• Regulatory route: In Depth Assessment

Regulatory judgement

This regulatory judgement confirms the regulator’s existing assessment of Home Group Limited’s governance and financial viability grades (G1/V2) following completion of an In Depth Assessment (IDA).

Based on evidence gained from the IDA, the regulator has assurance that Home Group Limited (Home) continues to comply with the financial viability elements of the Governance and Financial Viability Standard. Its financial plans are consistent with, and support, its financial strategy. Home has an adequately funded plan with sufficient security in place and forecasts to continue to meet its financial covenants.

Home is continuing to invest in improving the quality and energy efficiency of its existing homes. At the same time, Home plans to develop both social housing and homes for market sale. This will mean continued exposure to economic uncertainty, including in regard to inflation and interest rates. This results in lower financial headroom and a reduced capacity to respond to adverse events.

The regulator’s assessment of Home’s compliance with the governance elements of the Governance and Financial Viability Standard remains unchanged. Based on the evidence gained from the IDA, the regulator has assurance that Home’s governance arrangements enable it to adequately control the organisation and to continue meeting its objectives.

Other providers included in the judgement

None

About the provider

Origins

Home is a charitable community benefit society and the parent of the group. Its strategic focus is the development and management of housing, primarily for social and affordable rent, alongside a programme of development for sale on the open market and low cost home ownership.

Registered Entities

Home is the only registered entity in the group.

Unregistered Entities

Home has four unregistered subsidiaries, and the group is involved in 12 joint venture or associate arrangements.

The unregistered entities within the group are:

• Home in Scotland Limited, a charitable registered housing association registered with and regulated by the Scottish Housing Regulator, undertaking Home Group’s business in Scotland;
• Home Group Developments Limited, a private non-charitable company that undertakes new build construction of affordable housing and homes for sale on the open market;
• North Housing Limited, a private, non-charitable company that acts as a vehicle to facilitate joint venture activity across the group. Joint venture partnerships are formed primarily to develop residential property; and
• Home Group Repairs Partnership Limited, previously named Live Smart @ Home Limited, is a private non-charitable company that provides repairs and maintenance services to the group.

Geographic Spread and Scale

Home‘s properties are spread across the country with the majority concentrated in the north east.

Staffing and Turnover

The group employs the full-time equivalent of 3,077 staff. Its turnover for the year ended 31 March 2023 was £453.8m.

Development

From 2025 to 2027, the group plans to develop around 3,000 new homes for general needs affordable and social rent, sale on the open market and low cost home ownership.  

About our judgements

Key to Grades

Governance:

	Compliant
G1	The provider meets our governance requirements.
G2	The provider meets our governance requirements but needs to improve some aspects of its governance arrangements to support continued compliance.

	Non-compliant
G3	The provider does not meet our governance requirements. There are issues of serious regulatory concern and in agreement with us the provider is working to improve its position.
G4	The provider does not meet our governance requirements. There are issues of serious regulatory concern, and the provider is subject to regulatory intervention or enforcement action.

Viability:

	Compliant
V1	The provider meets our viability requirements and has the financial capacity to deal with a wide range of adverse scenarios.
V2	The provider meets our viability requirements. It has the financial capacity to deal with a reasonable range of adverse scenarios but needs to manage material risks to ensure continued compliance.

	Non-compliant
V3	The provider does not meet our viability requirements. There are issues of serious regulatory concern and, in agreement with us, the provider is working to improve its position.
V4	The provider does not meet our viability requirements. There are issues of serious regulatory concern, and the provider is subject to regulatory intervention or enforcement action.

Note: The use of an asterisk (*) against a grade indicates that the assessment refers to a provider that is designated as being for-profit.

Definitions of Regulatory Routes

In Depth Assessment (IDA): An IDA is a bespoke assessment of a provider’s viability and governance, including its approach to value for money. It involves on-site work and considers in detail a provider’s ability to meet its financial obligations and the effectiveness of its governance structures and processes.

Stability Checks: Based primarily on information supplied through regulatory returns, a Stability Check is an annual review of a provider’s financial position and its latest business plan. The review is focused on determining if there is evidence to indicate a provider’s current judgements merit reconsideration.

Reactive Engagement: Reactive engagement is unplanned work which is triggered by new information or a developing situation which may have implications for a provider’s current regulatory judgement.

Stability Checks and Reactive Engagement: In some cases, we will publish narrative regulatory judgements which combine evidence gained from both Stability Checks and Reactive Engagement.

For further details about these processes, please see Regulating the Standards.