Member Spotlight - Knowing Your Stock: EMH's Five-Year Asset Journey

The case for knowing your stock

The first major commitment in the strategy was an aggressive stock condition survey programme. Emh commissioned ARK consultancy to carry out in person surveys across the full portfolio, visiting every home rather than relying on archetype estimates. The programme was board approved at full cost and delivered at scale.

Four years on, 99% per cent of homes have a valid stock condition survey. Decent homes compliance stands at 99.15% per cent. The 30-year financial plan, revisited every 12 months as new stock data comes in, has been approved with capital investment rising to £37 million over the next four years.

Ian Davies, Executive Director of Quality Homes at emh, describes what it was like when he joined. At that point, investment decisions were informed but not well grounded. The shift from archetype surveys to actual in-home data has changed what the organisation knows about its stock at component level, and in turn changed how it plans and spends.

"Complaints are down, customer experience is up, expenditure is up. That's the return on the investment. That's the triangle."

Capital spend has risen from £7.8 million in 2021 to £25 million over each of the past two years. Complaints relating to repairs have fallen by 33 per cent. Resident satisfaction on the tenant satisfaction measures has risen by 11 per cent across resident experience and repairs on time. And for the fifth consecutive year, emh has won the Landlord of the Year category at the East Midlands Energy Efficiency Awards and the National award in 2024. This in recognition of the approach on decarbonising residents’ homes, improving energy efficiency to EPC C whilst saving residents C.£500 a year on their utility costs.

In year four of the strategy, the organisation is also seeing the first signs of a return on its capital investment in the revenue account. Higher planned expenditure is beginning to reduce reactive repair demand. Ian had anticipated that return emerging somewhere between years four and seven. The trajectory is now visible.

Fabric first: a deliberate pivot

Emh was an early mover on renewables, installing air source and ground source heat pumps at a scale which was unusual for an organisation of its size. The early experience was instructive. As Ian explains, the organisation began to receive a small but notable number of complaints from residents who preferred their previous gas systems, citing efficiency concerns.

That prompted a strategic pause. The EPC survey data, gathered alongside the stock condition programme, reinforced the case for caution: the fabric of a significant proportion of emh's stock needed addressing before heating systems could be changed with confidence. Much of the portfolio includes solid-wall construction, where fabric investment is the logical first priority.

The pivot to fabric first was written into the asset management strategy. Emh has since focused capital on improving the physical fabric of homes before returning to renewables. First-generation heat pumps that are no longer performing efficiently are now being replaced as they reach end of life.

A new wave of activity is under way. Emh has submitted a £4 million bid through Midlands Net Zero Hub for photovoltaic installations.

The road to EPC C by 2030

Around 4,100 homes in the portfolio currently sit below EPC C, but the analysis reveals a more tractable picture beneath it. Approximately 1,800 of those homes require only minimum measures, loft top-ups, lighting upgrades, or improved metering controls, to reach the C threshold.

Those homes are being layered into the capital investment programme in 2027/28 and 2029/29. The approach is to carry out the minimum measures while planned works are already under way in the property, whether a kitchen, bathroom, or roof. The aim is to move around 2,000 homes over the EPC C line without requiring separate mobilisations and improves resident experience having less appointments.

The 30-year financial plan includes provision from 2030 to not replace gas boilers on a like-for-like basis as they reach end of life, but incorporates the additional financial requirements of transitioning to renewables in a phased and fabric ready way.

A model for disposal and investment

Alongside the investment programme, emh runs an active disposal programme driven by its strategic asset performance model. The model considers 60 data sets before recommending a course of action, taking into account amenity, churn, and the wider role of a property as well as its physical condition and projected investment cost.

Properties are rated A, B, or C. Grade A homes are prioritised for 30-year investment. Grade B homes are reassessed at void, with a framework that specifies what work is required before they are re-let. Grade C homes, are approved for sale when they become void.

As emh's development pipeline grows toward 500 new homes per year, the relationship between disposals, new supply, and where residents need to be housed will increasingly shape how the strategy is calibrated. 

Triangulating the results

Emh implemented MRI Asset Management System as part of the five-year strategy, creating a single source of truth as it interfaces with the Housing Management System.  

The overall picture that emerges from the five-year strategy is one of deliberate, evidence led progression. Investment in knowing the stock has enabled investment in improving it. Investment in improving it is now generating a measurable return in resident experience, repairs performance, and revenue spend. And the next strategy, currently in development, will address what it takes to get from where emh now stands to full EPC C compliance by 2030.

That is not a small task. But it is, for the first time, a well evidenced one.

Image credit: Ian Davies, emh