The Rental Income Collection Challenge
18th March 2024
Rent arrears within social housing have reached worrying levels. With over £60 million outstanding in rental income, the recent surge of 11% means fewer resources for building new homes and maintaining existing stock. However, through strategic implementation of the right income collection technology, future-focused leaders have the power to usher in a new era of financial sustainability in the sector.
This article explores the challenges of rental income collection, how technology can help and the indispensable features of effective automated income management.
Rent arrears are on the rise
In a dynamic social housing landscape, the ability to maximise rental income collection is a linchpin for the financial health of social housing providers in the UK.
Research from the National Federation of ALMOs in August 2023 reveals a 4% increase in households in arrears. That translates into arrears surging by 11% to over £60 million.
The real cost of rental income collection
Housing providers face a formidable challenge in maximising income collection. Regulatory changes, economic fluctuations, and the aftermath of welfare reforms have intensified the risk of non-collection. The responsibility of housing benefit payments directly shifting to tenants adds another layer of complexity.
With diminished services and a cost-of-living crisis for tenants, innovative solutions are needed to help social housing providers navigate this complexity so they can maximise their income.
Overcome complexity with innovation
Traditional manual approaches relied on increasing staff numbers which can be costly without addressing underlying challenges. In response, housing providers are turning to income risk management solutions to streamline operations and enhance efficiency.
As housing leaders seek to reduce arrears, solutions like Netcall’s Rent-IQ™ are feature-rich, strategic solutions for housing providers, offering a robust toolkit to handle complexities, deliver efficiency and ultimately ensure the financial sustainability of housing providers.
Not all income collection tools are made equal
Effective income collection solutions use advanced algorithms to analyse rent payment patterns, identify trends, and predict potential payment issues. By providing predictive intelligence, they should empower staff to intervene proactively, minimising risk of non-collection and maximising revenue streams.
But not all rent income management tools are created equal. There are key features that should collectively form a robust foundation for any effective solution — giving housing providers the tools they need to handle income collection complexities efficiently.
5 Must-have features of a rent income management solution
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Data integration: Seamless integration with Housing Management and financial/payment systems gives you a comprehensive understanding of each tenant’s financial history, for better decision making.
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Tenant history: With a complete view of a tenant’s payment history, income officers are empowered to make informed and effective decisions.
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Payment behaviour alerts: Use advanced algorithms to proactively pick up changes in tenant payment behaviour — giving you early warning alerts that mitigate the risk of non-payment. Discover Rent-IQ™.
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Task automation: Streamline workflows and optimise staff time so you need less manual intervention and can focus your resources where they’re needed most.
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Proactive communication: Target tenant communication through voice, email, and SMS channels to encourage timely payments and foster positive tenant relationships.
“As housing leaders seek to reduce arrears, solutions like Netcall’s Rent-IQ™ are feature-rich, strategic solutions for housing providers, offering a robust toolkit to handle complexities, deliver efficiency and ultimately ensure the financial sustainability of housing providers.”
Mark Gannon
Director of Client Solutions, Netcall