Heart of Medway Housing Association Limited (4634) - Regulatory Judgement: 30 July 2025
Published 30 July 2025
Applies to England
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Our Judgement
| Grade/Judgement | Change | Date of assessment | |
|---|---|---|---|
| Consumer | C1 Our judgement is that overall the landlord is delivering the outcomes of the consumer standards. The landlord has demonstrated that it identifies when issues occur and puts plans in place to remedy and minimise recurrence. |
First grading | July 2025 |
| Governance | G1 Our judgement is that the landlord meets our governance requirements. |
First grading | July 2025 |
| Viability | V1 Our judgement is that the landlord meets our viability requirements and has the financial capacity to deal with a wide range of adverse scenarios. |
First grading | July 2025 |
Reason for publication
We are publishing a regulatory judgement for Heart of Medway Housing Association Limited (Heart of Medway) following an inspection completed in July 2025.
This regulatory judgement confirms a consumer grading of C1, a governance grading of G1 and a financial viability grading of V1.
This is the first time we have issued a regulatory judgement in relation to this landlord.
Summary of the decision
From the evidence provided and assurance gained during the inspection we have concluded that, overall, Heart of Medway is delivering the outcomes of the consumer standards. Based on this assessment, we have concluded a C1 grade for Heart of Medway.
Our judgement is that Heart of Medway meets our governance requirements. Heart of Medway has provided evidence to demonstrate the effectiveness of its governance arrangements, and that it continues to effectively manage the risks of its activities, allowing it to deliver its strategic and charitable objectives. Based on this assessment, we have concluded a G1 grade for Heart of Medway.
Our judgement is that Heart of Medway meets our financial viability requirements and has the financial capacity to deal with a wide range of adverse scenarios. Heart of Medway has a strong financial profile, and its stress testing demonstrates that financial capacity is built into its business plan. Heart of Medway has provided appropriate assurance that it has access to sufficient liquidity and adequate funding in place. Based on this assessment, we have concluded a V1 grade for Heart of Medway.
How we reached our judgement
We carried out an inspection of Heart of Medway to assess how well it is delivering the outcomes of the consumer standards and meeting our governance and financial viability requirements, as part of our planned inspection programme. During the inspection, we considered all four of the consumer standards: Neighbourhood and Community Standard, Safety and Quality Standard, Tenancy Standard, and the Transparency, Influence and Accountability Standard.
During the inspection we observed a board meeting, spoke with tenants, held meetings with Heart of Medway and its non-executive directors, and reviewed a wide range of documents provided by Heart of Medway.
Our regulatory judgement is based on all the relevant information we obtained during the inspection, as well as analysis of information received from Heart of Medway through its regulatory returns and other regulatory engagement activity.
Summary of findings
Consumer – C1 – July 2025
During the inspection, Heart of Medway provided evidence-based assurance that it has appropriate systems in place to ensure the health and safety of its tenants in their homes and associated communal areas. There is evidence that Heart of Medway keeps an accurate record of the condition of its homes at an individual property level through physical surveys of all homes and has a process for keeping this information up to date. Heart of Medway has increased its capacity to deliver its programme of stock condition surveys and has demonstrated that it uses its understanding of the condition and safety of its tenants’ homes to make decisions on future investment to maintain and improve homes.
During the inspection we saw evidence that Heart of Medway provides an effective repairs service to tenants and takes action to improve the service and outcomes for tenants when issues occur. Heart of Medway identified issues with the timeliness of non-emergency repairs, and in response it undertook a comprehensive review whilst implementing mitigating actions and making changes to the repair service to deliver improved outcomes for tenants. We saw evidence that in the twelve months preceding the 2025 inspection, Heart of Medway delivered significant improvements in the delivery of its day-to-day repairs service to ensure that it did not have a backlog.
In relation to the Neighbourhood and Community Standard, we gained assurance that Heart of Medway works with appropriate partners to deter and tackle anti-social behaviour (ASB) and hate incidents in the neighbourhoods where it provides social housing.
Heart of Medway provided evidence that it seeks to offer tenures appropriate for the homes it lets, taking into account the purpose of the accommodation, the needs of individual households, the sustainability of the community and the efficient use of social housing. Heart of Medway has an allocations policy that sets out its approach to ensuring all properties are let in a fair and transparent way. We saw evidence of Heart of Medway ensuring tenants are supported in sustaining their tenancies.
Overall, Heart of Medway’s approach is delivering the outcomes of the consumer standards in relation to the Transparency, Influence and Accountability Standard. We saw evidence that it treats tenants with fairness and respect and is continuing to increase its understanding of its tenants. Heart of Medway demonstrates an active approach to considering tenants’ diverse needs in the design and delivery of services and monitors its performance in continuing to deliver outcomes to tenants in this area.
We saw evidence that Heart of Medway regularly reviews performance information on complaints handling. It provided evidence that it learns from information on complaint types and outcomes, using this to make improvements. Heart of Medway provided evidence that it had acted when issues were identified in managing complaints within its target timescales. Heart of Medway has reviewed its service provision, and increased resources and capacity in this area. In the 6 months preceding the 2025 inspection, Heart of Medway delivered improved performance in meeting complaints handling target timescales. However, it is important that this is kept under review to ensure this issue has been remedied and to prevent recurrence.
Heart of Medway demonstrated that the design of its engagement and scrutiny arrangements provide a wide range of meaningful opportunities for its tenants to share their views and provide scrutiny. There was evidence that feedback from tenants and scrutiny reviews influences Heart of Medway’s decision making. Heart of Medway provided assurance that it makes effective use of its performance information to improve services and provide a range of information to tenants to support effective scrutiny. Improvements made as a result of scrutiny reviews by tenants include how Heart of Medway manages ASB and communicates with customers on stock condition surveys.
Governance – G1 – July 2025
Heart of Medway is a subsidiary of MHS Homes Limited (MHS), an organisation which is not registered with the regulator and is a charity. Heart of Medway does not employ any staff, and all management and maintenance services to customers are provided through management agreements with MHS. Suitable agreements containing information requirements, escalation and resolution provisions are in place with MHS which support the delivery of intended outcomes for tenants, and the protection of social housing assets. During the inspection Heart of Medway provided evidence that it has established and maintains clear roles, responsibilities and accountabilities within its leadership and governance structure.
Based on the evidence gained from the inspection there is assurance that Heart of Medway’s governance arrangements enable it to effectively manage its risk and adequately control the organisation, allowing it to deliver its objectives. Heart of Medway’s board demonstrated that it provides challenge on performance against the organisation’s strategic targets and consideration of risk appetite in strategic decision making.
Heart of Medway has provided appropriate assurance that its board proactively reviews its approach to delivering against its purpose and regularly considers alternative options for achieving value for money in making best use of resources.
Board member skills, experience and knowledge are aligned with the activities of the organisation and there is a structured approach to developing and appraising skills to support succession planning. We saw evidence of this through board observation, meetings with non-executive directors and the executive team as well as reviewing relevant documents including meeting minutes.
Heart of Medway has a risk management and control framework that aligns to its strategic risks. There is evidence of robust discussion and board challenge of the controls and assurance on strategic risks, and of risks being managed effectively in practice.
We saw evidence that Heart of Medway’s board actively seeks and gains an appropriate level of assurance across a range of areas. There is evidence of how this assurance has been used to make improvements including on the approach to ASB, stock condition data, and damp and mould.
There is evidence of board ownership of stress testing, mitigation strategies and wider governance over risks through regular and structured reviews of golden rules. Reporting to the board provides sufficient detail for it to ensure effective oversight.
Viability – V1 – July 2025
Based on the evidence gained from the inspection we have concluded that there is appropriate assurance that Heart of Medway’s financial plans are consistent with, and support, its financial strategy. Heart of Medway has appropriately evidenced that it has an adequately funded business plan, sufficient security in place to support its financial plans, and is forecast to continue to meet its financial covenants under a wide range of adverse scenarios. Heart of Medway’s board has effective oversight of covenant compliance with actual and projected covenants reported quarterly.
Heart of Medway has a strong financial profile, there is financial capacity built into its business plan and there are strong levels of forecast headroom with no reliance on sales (first tranche shared ownership, staircasing, or outright). Heart of Medway forecasts strong interest cover whilst continuing to deliver its development programme and investing in existing stock to meet its aspirations for decarbonisation and the quality of its homes.
Background to the judgement
About the landlord
Heart of Medway is an exempt charity registered under the Co-operative and Community Benefit Societies Act 2014. Heart of Medway is the only RSH registered entity in its group and is the subsidiary of an unregistered charitable parent, MHS Homes Limited which owns and manages around 10,000 homes across Kent.
Heart of Medway operates across five local authority areas in Kent and owns and manages around 1,200 social housing homes.
Heart of Medway employs no staff, with management and maintenance services provided by MHS through a management agreement. Turnover for the year ended 31 March 2024 was £7.4m. Heart of Medway plans to develop around 100 homes between 2024 and 2027.
Our role and regulatory approach
We regulate for a viable, efficient, and well governed social housing sector able to deliver quality homes and services for current and future tenants.
We regulate at the landlord level to drive improvement in how landlords operate. By landlord we mean a registered provider of social housing. These can either be local authorities, or private registered providers (other organisations registered with us such as non-profit housing associations, co-operatives, or profit-making organisations).
We set standards which state outcomes that landlords must deliver. The outcomes of our standards include both the required outcomes and specific expectations we set. Where we find there are significant failures in landlords which we consider to be material to the landlord’s delivery of those outcomes, we hold them to account. Ultimately this provides protection for tenants’ homes and services and achieves better outcomes for current and future tenants. It also contributes to a sustainable sector which can attract strong investment.
We have a different role for regulating local authorities than for other landlords. This is because we have a narrower role for local authorities and the Governance and Financial Viability Standard, and Value for Money Standard do not apply. Further detail on which standards apply to different landlords can be found on our standards page.
We assess the performance of landlords through inspections and by reviewing data that landlords are required to submit to us. In Depth Assessments (IDAs) were one of our previous assessment processes, which are now replaced by our new inspections programme from 1 April 2024. We also respond where there is an issue or a potential issue that may be material to a landlord’s delivery of the outcomes of our standards. We publish regulatory judgements that describe our view of landlords’ performance with our standards. We also publish grades for landlords with more than 1,000 social housing homes.
The Housing Ombudsman deals with individual complaints. When individual complaints are referred to us, we investigate if we consider that the issue may be material to a landlord’s delivery of the outcomes of our standards.
For more information about our approach to regulation, please see Regulating the standards.