Home Group Limited (202314124)

REPORT

COMPLAINT 202314124

Home Group Limited

17 February 2025

Our approach

The Housing Ombudsman’s approach to investigating and determining complaints is to decide what is fair in all the circumstances of the case. This is set out in the Housing Act 1996 and the Housing Ombudsman Scheme (the Scheme). The Ombudsman considers the evidence and looks to see if there has been any ‘maladministration,’ for example whether the landlord has failed to keep to the law, followed proper procedure, followed good practice, or behaved in a reasonable and competent manner.

Both the resident and the landlord have submitted information to the Ombudsman and this has been carefully considered. Their accounts of what has happened are summarised below. This report is not an exhaustive description of all the events that have occurred in relation to this case, but an outline of the key issues as a background to the investigation’s findings.

The complaint

The complaint made by the resident’s representative is about:
1. The landlord’s response to his request to suspend rent payments for the property.
2. The landlord’s response to his request for it to buy-back the property.
The Ombudsman has also considered the landlord’s handling of the associated complaint.

Background

The resident sadly passed away in June 2022. The resident’s representative made the complaint on behalf of his estate. The representative has provided Grant of Probate which names him as the executor of the estate.
The resident was a shared ownership leaseholder of the landlord, a housing association. The lease agreement commenced in February 2018 and the resident owned 35% of the property. The property is a 1-bedroom, ground floor flat in a 5-storey residential building.
Following the death of the resident, the representative and the estate’s solicitor initiated the sales process of the property.
On 16 February 2023, the landlord informed the representative that it had commissioned specialist inspections of the building (where the property was located) as part of its fire safety programme in February 2022. The investigations concluded that the building was safe, but there were some remedial works required and that if an EWS1 form were to be commissioned, the rating provided would be B2. It explained that this would therefore make it “extremely difficult” for any lender to offer a new mortgage on any of the flats in the building.
For context, EWS1 is a form that was introduced in 2018 following the Grenfell fire. The form was designed to provide assurance for residents, lenders, valuers, buyers, and sellers. It requires building owners to have their buildings’ cladding reviewed by fire safety experts and assigns each building a rating. ‘Option A’ indicates that the external wall materials are unlikely to support combustion. ‘Option B’ indicates that the cladding does have combustible materials in it. It is then divided into 2 categories. B1 indicates that the fire risk is low enough that no additional work is required. B2 means the fire risk is high enough that extra work must be done.
On 2 March 2023, the landlord informed the estate’s solicitor that the sale of the property was on hold due to EWS1 investigations. It explained that the only way to work around the issue would be to market the property with an estate agent to find a cash buyer, who did not require a mortgage.
On 26 May 2023, the landlord informed the representative that the required works to the building would not be undertaken for at least 18 months. It said this was because of a backlog of other works, as well as budget restraints. It advised him that in the meantime, it was exploring the available options to help mitigate the accruing rent on the property.
The representative made a complaint to the landlord on 5 November 2023. He said he was unhappy that:
1. The landlord had refused his request to freeze the rent payments for the property until the EWS1 certificate was issued.
2. The landlord had also refused to buy–back the 35% share in the property.
3. The landlord had showed a lack of compassion in the handling of the matter, and it was a “moral injustice” that the inheritance of the resident’s 3 children was being impacted by the landlord’s decisions.
The landlord provided its stage 1 response on 21 December 2023. It said:
1. The rent account was currently £12,370.15 in arrears. The rent and service charges would continue to be charged, but it would not collect the arrears on the account until the point of sale. If there was a deficit at the point of sale, it would “write the debt off”.
2. It had offered the estate the option to sub-let the property on a short-term basis to retrieve some of the money lost. It acknowledged that the representative had declined this offer.
3. Remedial works were still ongoing to the building. It anticipated that it could take up to 9 months to complete, and it would keep the representative updated on the progress.
4. It acknowledged the circumstances were unusual, however it was unable to buy–back the 35% share of the property, as the position did not meet the policy criteria.
In the landlord’s stage 2 complaint response on 26 February 2024, it said:
1. The rent account was currently £13,650 in arrears.
2. Its position remained the same, and it could not freeze the rent account or buy back the property.
3. It was sorry for the complaint handling delays and offered £150 in compensation.

Events after the end of the complaint process

On 15 January 2025, the landlord informed the representative that the remedial works to the building had been completed. It said that it anticipated the specialist fire engineer would sign off the ESW1 form and it would forward him a copy of the form upon receipt.

Assessment and findings

Scope of investigation

The representative told us that as an outcome to the complaint he would like the landlord to buy-back the property and to clear the accumulated debt on the rent account from the date he was prevented from marketing the property. Where the Ombudsman finds failure on the landlord’s part, we can consider the resulting distress and inconvenience. Unlike a court, we cannot establish liability or award damages. Financial damages are a legal matter, and the representative can obtain legal advice if he wishes to pursue his claim through the courts.

Response to request to suspend rent payments

The Ombudsman understands that the representative’s current situation is difficult and that he is in this position through no fault of his own. It is also acknowledged that the work required to the building is complex and the situation is compounded by the cost of completing the EWS1 and the availability of fire safety experts qualified to complete it.
While not directly related to the representative’s complaint, it is noted that there was an apparent 12-month delay in the landlord informing the representative of the outcome of its inspections in February 2022. This is concerning, as improved communication around this may have had a bearing on the events of this case.
The solicitor representing the estate requested the landlord to suspend the rent payments on 12 April 2023. The evidence suggests that the request was escalated to the landlord’s management team, which was appropriate. The landlord’s internal correspondence shows that it “had never known a situation where it would freeze rent due to planned maintenance”, and that “there were other financial implications” to it doing so. The landlord advised the solicitor on 19 April 2023 that it was unable to waive the rent or service charge for the property. This was a reasonable decision, as it was in line with the lease agreement, which states that the leaseholder must pay the specified rent in line with the letting terms, without deduction.
However, the Ombudsman’s guidance note on fire safety and cladding advises that, when investigating a complaint relating to fire safety and cladding, we will consider how the landlord has responded to the individual circumstances of the resident. Therefore, in our opinion, the landlord’s unsympathetic response suggests that it did not take his personal circumstances into account when initially making its decision. It also would have been appropriate for the landlord to explain its reasoning for refusing the request.
On 24 April 2023, the solicitor asked the landlord to review its decision. Between 3 May and 24 May 2023, the landlord discussed the review request internally. The evidence shows that the landlord considered the representative’s circumstances and mirrored the decision of other complex cases. It concluded that it was fair to agree for the estate to pay the accruing rent upon completion of the sale, to assist with any potential cash flow issues. We find that this was a reasonable offer from the landlord. It is noted, however, that the representative’s primary concern was that by the time he was able to sell the property, there may have been no remaining equity for the resident’s children.
As there is no guidance from the landlord on its target timescales for responding to such requests, we are unable to comment on this. However, we acknowledge that the representative and the solicitor chased an update from the landlord during this time (April to August). We find that it therefore would have been reasonable for the landlord to keep the parties regularly updated during its decision-making process.
In addition to the above, on 2 March 2023, the landlord informed the solicitor that while remedial works were undertaken, the representative could market the property with an estate agent to find a cash buyer. On 5 December 2023, it also advised the representative that the situation in the lending sector may have changed and asked him to inform it if there was a broker who would accept a B2 rated EWS1. It said it was willing to supply him with supporting documents to provide reassurance to lenders that the remedial works were ongoing and it would not be recovering costs from leaseholders. Although it is accepted that finding a cash buyer for the property may reduce the chances of a sale, we consider that this was an appropriate alternative proposal from the landlord. It is, however, noted that the representative did not wish to market the property for a cash buyer only.
The lease agreement states that the resident is not permitted to sub-let the property until they staircase to 100% ownership of the property. However, the landlord’s home ownership policy states that a short-term sub-letting arrangement lasting no longer than 12 months may be agreed. We therefore find that the landlord also acted reasonably in offering to allow the representative to sub-let the property until the works to the building were completed. The landlord’s offer demonstrated that it had considered his individual circumstances that he needed to mitigate some of the financial pressure on the resident’s estate. Nevertheless, it is understood that the representative did not wish to sub-let the property due to his personal circumstances.
The landlord reiterated its position to the representative within its stage 1 and stage 2 responses. It did, however, advise him that should there be a deficit at the point of sale, it would write the debt off and not bill any outstanding sum. This was reasonable, as the resident had previously voiced his concerns about the estate being in a deficit at the point of sale. An assessment of the complaint responses is made within the complaint handling section of this report.
Although it is accepted that this case presents exceptional circumstances, we find that the landlord acted in line with its legal obligations in its decision not to suspend the rent payments on the property. While we appreciate the representative is in a difficult situation, the landlord’s recommendation of marketing the property for a cash buyer, and its offer of subletting the property, were reasonable options to mitigate the estate’s financial loss.
However, overall, we find that there was service failure in the landlord’s handling of the representative’s request to suspend the rent payments. This is because it failed to provide a clear explanation to the representative regarding its reasoning for rejecting the request, and did not keep him informed when he requested an update on its decision.
An order of compensation has been calculated in accordance with the landlord’s own compensation guidance, as well as the Ombudsman’s remedies guidance.

Response to request to buy-back the property

We recognise that there is no legal obligation for the landlord to buy-back the property, and that any buy-back is agreed at the landlord’s discretion. Its decision whether to buy-back a property should be made in accordance with its own policies.
The landlord told this Service that it does not have a specific ‘buy-back’ policy, but its approach is covered within its home ownership policy. The policy states that it will assess each potential buy-back to help relieve the financial pressure on shared owners on a case-by-case basis, and in line with the government’s capital funding guidance. The policy stresses that the circumstances where a buy-back will be granted are exceptional and that the option is intended to support residents when they are at risk of losing their home because of severe financial hardship.
It is not the Ombudsman’s expectation that landlord should automatically offer options to release equity, but we do expect landlords to have considered whether this is an option they can accommodate in exceptional circumstances. Landlords should consider what those exceptional circumstances may be, adopting a holistic and empathetic approach to the range of circumstances that may impact residents.
On 7 June 2023, the representative asked the landlord if it would consider buying back the property. It said that it doubted it would be able to do so, as it may “set a precedent”, but advised him that it would find out what the process was. In our opinion, it was reasonable for the landlord to have concerns about setting a precedent that may not be financially sustainable or practically deliverable.
Between 15 June and 19 August 2023, the landlord discussed the case at length internally, including with its legal team. It recognised that it was an unusual set of circumstances, and actively sought advice and perspectives from other housing associations and a Royal Institute of Chartered Surveyors (RICS) valuer. This was a positive approach from the landlord and showed that it was taking the representative’s request for a buy-back seriously.
We consider that for the landlord’s buy-back procedure to be fair, a process should be implemented whereby applicants are asked specifically about issues that may impact their application and mean that their case is considered “exceptional”. On 19 August 2023, the landlord discussed internally how it could adopt a creative model and supportive mindset, for cases with extenuating circumstances such as this case. It said that balancing its approach between innovative solutions and a focus on flexible tenure criteria was vital in the current economic landscape. Although we do not know the outcome of the review, this showed that it was endeavouring to learn from the case.
On 26 August 2023, the representative contacted the solicitor to advise he had received a telephone call from the landlord. He said it confirmed that it was unwilling to buy-back the flat, for reasons he “didn’t fully understand.” The landlord provided us with details of a call note which did not include a date. This is a record keeping failure within its handling of the matter. However, based upon the content, it is reasonable to assume it was around the same time. Upon reviewing the evidence, it is our opinion that the landlord could have done more to explain how its decision had been reached. We appreciate that the landlord provided the representative with the relevant policies it had considered, however the evidence does not show that it explained the specific reasons why it had refused his request. While there was no obligation to do so, the landlord could have followed up in writing to the representative and set out the factors that were taken into consideration in reaching its decision. Providing such an explanation would have provided him with reassurance that his individual circumstances were taken into account and may have helped him to understand how the decision had been made. As the landlord did not provide evidence of such an explanation, it was a shortcoming in its handling of the matter.
While we appreciate this was a complex case for the landlord to consider, it took over 11 weeks to inform the representative of its decision. We find that it would have been appropriate for the landlord to inform him promptly of the outcome of its decision on the buy-back. Its omission to do so likely caused him some uncertainty and avoidably prolonged his distress.
Overall, while the landlord had no obligation to freeze the rent or buy-back the property, it is the Ombudsman’s opinion that its communication with the representative was lacking in relation to the matter. Although the evidence suggests that it had considered his personal circumstances internally, it took an undue amount of time to respond and failed to provide transparency or display empathy to the representative. It is for this reason there was service failure in its handling of the representative’s request for it to buy-back the property.
An order of compensation has been calculated in accordance with the landlord’s compensation procedure and our remedies guidance to reflect the distress and inconvenience caused.

Complaint handling

At the time of the complaint, the landlord operated a 2-stage complaints process. Stage 1 complaints were to be acknowledged within 5 working days and responded to within 10 working days. Stage 2 complaints were to be acknowledged within 5 working days and responded to within 20 working days. Where these timescales were not possible, the policy stated the landlord would provide a written explanation to the complainant, containing a clear explanation of the expected timescales for the response. If an extension beyond an additional 10 working days was required, this would be agreed with the complainant.
Following confirmation from the landlord that it was unable to waive the rent or service charges for the property, the solicitor representing the estate requested to make a formal complaint on 24 April 2023. Between 2 May and 14 August 2023, the solicitor contacted the landlord on a further 7 occasions to pursue the complaint. While the landlord responded to some of the solicitor’s emails, we have seen no evidence that it opened a formal complaint, which was unreasonable.
In mitigation, we accept that the landlord may have required authorisation from the representative before it could continue with the solicitor’s complaint on behalf of the estate. However, there is no evidence that it sought this until 17 August 2023. This was also unreasonable, as it was 4 months after the solicitor had requested to make a complaint.
We also find that the landlord made some concerning comments during its communications with the solicitor. This included “I am not sure why you have referred the case to the Ombudsman, as I have been in contact with you.” In our opinion, this was inappropriate, and the tone was unprofessional. Landlords should not discourage residents from seeking advice and/or intervention from our Service.
The representative requested to make a complaint on 5 November 2023. He emailed a staff member directly and submitted a complaint via the landlord’s website. The staff member acknowledged the representative’s email on 9 November 2023 and advised him that the complaints team would be managing the complaint. This was appropriate.
However, we have seen no evidence that the landlord contacted the representative at stage 1 of the complaint process to introduce its complaint handlers, or to discuss his complaint and the outcomes sought. The Ombudsman’s Complaint Handling Code (‘the Code’) states that at each stage of the complaints process, complaint handlers must give the resident a fair chance to set out their position. Additionally, while it is not always necessary to meet with the complainant to discuss a complaint, it is good practice to do so.
The landlord’s internal complaint records state that the representative’s complaint was received on 9 November 2023. This was inaccurate, as he first made the complaint on 5 November 2023. Although this error is likely to have had minimal impact on the resident, we expect landlords to ensure accurate records of complaints are maintained.
In line with its complaints policy and the Code, the landlord should have provided the representative with its stage 1 response by 24 November 2023. As it failed to do so, the representative asked this Service to assist in progressing his complaint. We contacted the landlord on 28 November 2023 and instructed it to provide a stage 1 response by 6 December 2023.
On 6 December 2023, the landlord informed us that it would apologise to the representative as its complaint response was delayed due to the complexity of the case. We acknowledge that the landlord contacted the representative the previous day about the remedial works to the building. However, we have seen no evidence that it informed him of the complaint delays. This was unreasonable and is indicative of poor communication in its complaint handling.
On 15 December 2023, we instructed the landlord to provide a stage 1 response to the representative by 22 December 2023. We advised that if it failed to do so, we may issue it a Complaint Handling Failure Order (CHFO). The landlord issued its stage 1 response on 21 December 2023. This was inappropriate, as this was 35 working days after the representative had raised his complaint. Additionally, as the resident required repeated intervention from the Ombudsman to progress his complaint, we find that the landlord acted inappropriately.
Within the landlord’s stage 1 response, it is positive that it informed the representative of its current position on the matters he had raised. However, its response failed to provide an assessment of its handling of the substantive issues. It would have been appropriate for it to provide a timeline and assessment of the events leading up to the complaint. It also should have explained its decision-making process, in respect of its reasons for not freezing the rent payments or buying back the property.
We find that it would also have been appropriate for it to offer compensation for its complaint handling, in line with its compensation procedure.
On 22 December 2023, the representative requested to escalate his complaint to stage 2. The landlord acknowledged his request on 5 January 2024. Taking into account the non-working days over the Christmas period, this was reasonable. However, within the landlord’s stage 1 response (or within its autoreply to any complaints related correspondence received), it could have advised of its Christmas opening times. This would have set expectations around its complaint handling timescales.
On 15 February 2024, the landlord issued a stage 2 response. Within its closing paragraphs it stated that it proposed “to continue to progress the complaint until the outstanding issues were resolved and [it was] in a position to provide a full and final stage 2 response”. The landlord’s reference to another complaint response was confusing and not in line with the Code, and therefore we find that it acted inappropriately.
The landlord issued its ‘final’ stage 2 response on 26 February 2024. This was 36 working days after it had acknowledged the escalated complaint, which was unreasonable.
A stage 2 complaint is the final opportunity for the landlord to review its handling of the substantive issue, as well as the complaint handling process, and to put things right for the resident. However, in our opinion, the landlord’s stage 2 response failed to answer the complaint appropriately. It did not explain or evaluate its handling of the representative’s primary concerns. It also did not address the questions the representative had raised within his escalation request (an explanation of the criteria that the landlord said his current position did not meet). Its failure to fully do so could have been perceived by the representative to minimise or undermine what he no doubt felt were legitimate concerns.
We note the representative’s comments on 21 February 2024, when he told the landlord that he would await a more “positive and compassionate response”. The landlord acknowledged that the “circumstances were unusual”. However, in our opinion, the complaint responses at both stages lacked any empathy for the representative’s situation. This is highlighted in the Ombudsman’s spotlight report on Attitudes, Respect and Rights where landlords are sometimes seen to have a dismissive approach and lack of empathy with residents.
Within its stage 2 response, the landlord acknowledged and apologised for its poor handling of the complaint at stage 1. It said that feedback had been provided internally to ensure the same level of service was “not repeated moving forward”. This was a positive action from the landlord and showed that it was learning from its complaint handling.
The landlord offered the representative £150 compensation. It said this was made up of £75 for the stage 1 delays and £75 for the poor communication at stage 1. In line with our guidance on remedies, this was a reasonable offer of financial redress for the failures identified. However, it did not reflect all the failures identified by this investigation, as outlined above.
On 3 March 2023, the representative responded to the landlord’s stage 2 response. He said he was dissatisfied with the response and that the letter he had received was undated. The landlord responded the following day to say that it had reviewed the documents and there was a date visible below the address on the letter. However, the resident provided us with the undated copy of the version he received from the landlord. Although the impact on the representative may have been minimal, the landlord should always include dates on its correspondence to complainants to evidence compliance with the timescales outlined in the Code.
To summarise, it is the Ombudsman’s opinion that the landlord did not go far enough to put things right for the representative. It is for this reason that there was maladministration in its handling of the associated complaint. Additional compensation has been ordered to reflect the failures not accounted for by the landlord’s offer, in line with the landlord’s compensation procedure and our remedies guidance.

Determination

In accordance with paragraph 52 of the Scheme, there was service failure in the landlord’s response to the representative’s request for it to suspend rent payments for the property.
In accordance with paragraph 52 of the Scheme, there was service failure in the landlord’s response to the representative’s request to buy-back the property.
In accordance with paragraph 52 of the Scheme, there was maladministration in the landlord’s handling of the associated complaint.

Orders and recommendations

Orders

The landlord is ordered to do the following within 4 weeks of the date of this report:
1. Provide a written apology to the resident’s representative for the failings identified within this report. It should also include a clear explanation of how his circumstances do not meet its criteria for suspension of rent or buying back the property.
2. Pay the resident’s estate a total of £450 in compensation. The compensation should not be offset against any arrears. The landlord may need to see the Grant of Probate (or similar) before it issues the payment. The compensation is made up as follows:
  1. £100 for its handling of the representative’s request to suspend the rent payments.
  2. £100 for its handling of the representative’s request to buy-back the property.
  3. £250 for its handling of the associated complaint. This includes £150 previously offered by the landlord at stage 2, plus an additional £100 in recognition of the failures identified within this report.