Taking stock: how two housing associations swapped homes

The A2Dominion Group and Moat completed a milestone stock swap in September, with over £17.5m worth of property changing hands.

The two housing organisations were both seeking to rationalise their operations and focus their attention on the areas in which their housing stocks were concentrated.

A2Dominion’s managing director for London, Nigel Poole said: “To have two partners engage in a straight-forward stock swap is a rare occurrence, despite the fact the Housing Corporation has been pushing the concept, with increased pressure over the years, in order for housing associations to rationalise their businesses.

“Stock swaps have been around for a long time but are not widely used. Swapping stock can be a difficult process, due to differing grant levels and stock values between organisations.”

Barriers to swapping

Research published by the Housing Corporation and the Chartered Institute of Housing shows there are a number of barriers to stock swapping, including transactional and on-going costs, perceived tenant opposition and organisational cultural differences.

Poole said: “We did not encounter any significant hurdles during the stock-swap process. Both parties were willing to do business and we were assisted by the fact we both had similar grant levels and stock value.”

According to the Housing Corporation, rationalisation is a way to create and maintain thriving and sustainable neighbourhoods, giving a better quality of life to their members.

Poole said: “The stock swap was a logical move for both organisations. The key to its success relied on several factors – we were both keen to enter into the process, the stock we wanted to swap was of similar value and were in areas of interest to both parties.”

In total, A2Dominion swapped 45 apartments and 158 houses in return for 91 apartments, 73 sheltered homes, 111 leasehold apartments and four shops from Moat.

The rationale for the swap

A2Dominion wanted to divest itself of houses throughout Hastings, Rother, Sevenoaks and Tunbridge Wells – areas in which Moat already had a significant presence. Conversely, Moat had a large number of homes in north-west London where A2Dominion already had many successful schemes.

Poole said: “Being a long-distance landlord was not an ideal situation for us, as staff and services were a long way from residents in the south-east. This became a particular issue when maintenance needed to be carried out, as staff located some distance away had to be on site to oversee contractors.

“In addition, Moat has a Housing Corporation development programme and high resident satisfaction, so we were confident out residents would be moving seamlessly to an excellent landlord.”

Residents in A2Dominion’s and Moat’s homes were told about the negotiations and offered the opportunity to give their opinions.

Poole said the stock swap would give residents access to locally-based maintenance teams and greater transfer opportunities within the area.