Stonewater Limited (L1556) - Regulatory Judgement: 27 August 2025
Updated 27 August 2025
Applies to England
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Our Judgement
| Grade/Judgement | Change | Date of assessment | |
|---|---|---|---|
| Consumer | C2 Our judgement is that there are some weaknesses in the landlord delivering the outcomes of the consumer standards and improvement is needed. |
First grading | August 2025 |
| Governance | G1 Our judgment is that the landlord meets our governance requirements. |
Assessed and unchanged | August 2025 |
| Viability | V2 Our judgement is that the landlord meets our viability requirements. It has the financial capacity to deal with a reasonable range of adverse scenarios but needs to manage material risks to ensure continued compliance. |
Regrade | August 2025 |
Reason for publication
We are publishing a regulatory judgement for Stonewater Limited (Stonewater) following an inspection completed in August 2025.
This regulatory judgement confirms a consumer grading of C2, a governance grading of G1 and a financial viability grading of V2.
Prior to this regulatory judgement, the governance and financial viability gradings for Stonewater were last updated in November 2024 following a stability check to confirm a G1 grade for governance and a V1 grade for financial viability.
This is the first time we have issued a consumer grade in relation to this landlord.
Summary of the decision
From the assurance gained during the inspection, based on the evidence provided by Stonewater, we have concluded that there are some weaknesses in Stonewater delivering the outcomes of the consumer standards and improvements are needed, specifically in relation to outcomes in our Safety and Quality Standard and the Transparency, Influence and Accountability Standard. Based on this assessment, we have concluded a C2 grade for Stonewater.
Our judgement is that Stonewater meets our governance requirements. Stonewater 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 objectives. Based on this assessment, we have concluded a G1 grade for Stonewater.
Our judgement is that Stonewater meets our financial viability requirements and has the financial capacity to deal with a reasonable range of adverse scenarios, but it does need to manage material risks to ensure continued compliance. With increased spending on existing homes, Stonewater has reduced capacity to manage adverse events. Stonewater has provided appropriate assurance that it has access to sufficient liquidity and adequate funding in place. Based on this assessment, we have concluded a V2 grade for Stonewater.
How we reached our judgement
We carried out an inspection of Stonewater 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 regulatory 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 and a customer scrutiny panel, spoke with customers, held meetings with Stonewater, including with its non-executive directors, and reviewed a wide range of documents provided by Stonewater.
Our regulatory judgement is based on all the relevant information we obtained during the inspection as well as analysis of information received from Stonewater through its regulatory returns and other regulatory engagement activity.
Summary of findings
Consumer – C2 – August 2025
During the inspection, Stonewater provided evidence-based assurance that it has appropriate systems in place to ensure the health and safety of its customers in their homes and associated communal areas. Stonewater is meeting landlord health and safety requirements including delivering actions coming from assessments. Stonewater regularly obtains independent and specialist assurance across all statutory compliance activities including making sure the information it holds is correct.
There is evidence that arrangements are in place to ensure there is an accurate record of the condition of Stonewater’s homes, including a process for keeping this information up to date through a programme of physical inspections. There is evidence that Stonewater uses the information it has on the quality and safety of its homes to make decisions on future investment to maintain and improve the condition of its homes.
We found evidence of weaknesses in the provision of an effective, efficient and timely repairs service. Customer satisfaction, complaints and performance information demonstrates that improvement is needed in this area. While Stonewater is taking appropriate steps to resolve these weaknesses, including strengthening its processes for managing contractor performance , increasing board oversight, and trialling an alternative ‘locality based’ model, we have not yet seen sufficient evidence of improved and sustainable outcomes for its customers. We have assurance that Stonewater has appropriate plans in place to deliver the required improvements. Through our ongoing engagement we will continue to seek assurance from Stonewater that sufficient progress is being made to improve outcomes for customers.
We gained assurance that Stonewater is putting in measures to ensure complaints are addressed fairly, effectively and promptly, and that it is taking action to address increased levels of complaints. We saw evidence that Stonewater undertakes work to understand why complaints are made and to use any learning to improve the experience for customers raising complaints. However, Stonewater acknowledges that improvement in complaints performance is needed and is focused on achieving this including through investment in increased resourcing within its complaints team. Early signs of improvement have been seen but these will need to increase and be sustained over a longer period of time. Through our ongoing engagement we will continue to seek assurance from Stonewater on its progress against its action plan and that it is delivering the required improvements for its customers.
We gained assurance that Stonewater works in partnership with relevant organisations to deter and tackle anti-social behaviour (ASB), including hate incidents, in its neighbourhoods. The ASB service has recently been subject to customer scrutiny, and we were provided with evidence of how this has delivered improvements to the service.
In relation to the Transparency, Influence and Accountability Standard, there is evidence of Stonewater using the tenant information it holds to tailor services to meet tenants’ diverse needs and deliver fair and equitable outcomes. Relevant customer data is currently collected via a number of manual and ad hoc methods, including a rolling ‘data enrichment census’ and operational touchpoints such as repairs and complaints interactions. However, Stonewater was not able to evidence that they hold accurate and up to date data on a significant proportion of their customers via these collection methods. Stonewater recognises that it needs to continue to collect and update the information it holds regarding its tenants, and a dedicated project is underway to do this.
We found evidence that customers have a wide range of meaningful opportunities to influence and scrutinise Stonewater’s strategies, policies and services. These opportunities have directly influenced how Stonewater delivers services to improve outcomes for customers, including recent opportunities to scrutinise ASB, its approach to managing complaints, and communication around annual rent notices.
Customer engagement is clearly structured, from a local level through to board level, and well supported by Stonewater’s staff. Stonewater has provided appropriate evidence that it is making effective use of its performance and insight information to shape services. It provides a range of information for customers to support effective scrutiny, using customer, neighbourhood and building level information.
Our inspection found evidence that Stonewater’s approach to lettings and allocations is transparent, and that measures are in place to ensure terms of tenancy are appropriate and meet the needs of customers. There is a range of measures in place to support tenancy sustainment including successfully helping customers to access financial support.
Governance – G1 – August 2025
Based on the evidence gained from the inspection, we have assurance that Stonewater’s governance arrangements enable it to effectively manage its risks and adequately control the organisation, allowing it to deliver its strategic aims.
Stonewater has provided appropriate assurance that its board proactively reviews its approach to delivering against its purpose. It regularly considers alternative options to ensure it is achieving value for money and is making the best use of its resources, with a balance between building new homes, investment in existing homes and the delivery of effective landlord services to customers.
Stonewater was able to provide evidence that it has established and maintains clear roles, responsibilities and accountabilities within its leadership and governance structure. Continuing governance improvement is evidenced through in-depth periodic external governance reviews.
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 that feeds into succession planning.
Stonewater 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, including its approach to building safety and data and systems integration following the Mount Green merger in January 2024.
There is evidence that Stonewater’s board actively seeks and gains an appropriate level of assurance across a range of areas. There is also evidence of how this assurance has been used to make improvements to the quality of information held, its approach to repairs and complaints, and landlord health and safety compliance.
Board ownership of stress testing, mitigation strategies and wider governance oversight of risks through regular and structured review was evident through our inspection. Reporting to board provides sufficient detail for the board to ensure effective oversight. Stonewater’s board has an increased focus on monitoring financial indicators due to its weakened financial profile, with evidence of this gained during the inspection.
Our judgement is that the landlord meets our governance requirements.
Viability – V2 – August 2025
Based on the evidence gained through the inspection we have concluded that there is appropriate assurance that Stonewater’s financial plans are consistent with, and support, its financial strategy. Stonewater 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 reasonable range of adverse scenarios. Stonewater’s board has effective oversight of covenant compliance with actual and projected covenant performance reported quarterly.
Stonewater is increasing its investment into existing homes, putting pressure on its financial performance. Stonewater has a significant development programme to complete, which exposes it to housing market risks. Achievement of financial targets also relies on an increased disposals programme. When set in the context of the wider economic pressures and factors noted above, Stonewater’s capacity to respond to adverse events is reduced.
Background to the judgement
About the landlord
Stonewater is a charitable registered provider. Its main purpose is the provision of social housing for general needs, but it also provides homes for shared ownership.
The Stonewater group comprises three registered societies, all charitable registered providers, and four commercial entities, two of which are dormant. Stonewater is the asset owning group parent.
The group owns and manages around 37,000 social housing homes and operates across a wide geographic area of approximately 130 local authority areas.
Stonewater concentrates on rural areas and market towns, consciously avoiding large urban conurbations.
At 31 March 2024, Stonewater employed the full-time equivalent of 841 staff. Stonewater plans to develop approximately 4,000 homes over the next five years.
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.