Watmos Community Homes (L4383) - Regulatory Judgement: 30 April 2025
Updated 30 April 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 | April 2025 |
| Governance | G1 Our judgement is that the landlord meets our governance requirements. |
Upgrade | April 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. |
Assessed and unchanged | April 2025 |
Reason for publication
We are publishing a regulatory judgement for Watmos Community Homes (Watmos) following an inspection completed in April 2025.
This regulatory judgement confirms a consumer grading of C1, a governance grading of G1 and a financial viability grading of V2.
Prior to this regulatory judgement, the governance and financial viability grades for Watmos were last updated in November 2023 following a stability check which confirmed grades of G2 and V2. This is the first time we have issued a consumer grade in relation to this landlord.
Summary of the decision
From the evidence and assurance gained during the inspection, it is our judgement that overall Watmos is delivering the outcomes of the consumer standards. Based on this assessment, we have concluded a C1 grade for Watmos.
Our judgement is that Watmos meets our governance requirements. Watmos 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 an upgrade to a G1 grade for Watmos.
Our judgement is that Watmos meets our financial viability requirements and continues to have the financial capacity to manage a reasonable range of adverse scenarios. Watmos has provided appropriate assurance that it has access to sufficient liquidity and has adequate funding in place. Based on this assessment, we have concluded a V2 grade for Watmos.
How we reached our judgement
We carried out an inspection of Watmos 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 Watmos’ Resident Committee, spoke with tenants, held meetings with Watmos, including non-executive directors, and reviewed a wide range of documents provided by Watmos.
Our regulatory judgement is based on a review of all the relevant information obtained during the inspection as well as analysis of data received through regulatory returns and other regulatory engagement activity.
Summary of findings
Consumer – C1 – April 2025
During the inspection, Watmos provided evidence-based assurance that it has appropriate systems in place for ensuring the health and safety of its tenants in their homes and communal areas. Watmos has demonstrated that it has a reasonable understanding of its homes at an individual property level obtained through physical surveys and a recent large-scale improvement programme of its tower blocks in Walsall. Watmos is continuing its programme of individual surveys and expects to have surveys for all its homes by mid-2025. Watmos has provided evidence that it uses this information to identify investment needs, and to ensure homes meet the Decent Homes Standard (DHS).
We gained assurance through the inspection that Watmos provides an effective, efficient and timely repairs service. Watmos has provided evidence that it uses its data and performance information to identify and address any differences in repairs service outcomes across the areas it operates in and continues to work with tenants to ensure consistency.
Watmos provided assurance that it is delivering the outcomes of the Neighbourhood and Community Standard, working in partnership with appropriate partners, including local authority departments, the police and other relevant organisations to deter and tackle anti-social behaviour (ASB) in the neighbourhoods where it provides homes. We also saw evidence that it is allocating and letting its homes in a fair and transparent way and supporting its tenants to maintain their tenancies.
In relation to the Transparency, Influence and Accountability Standard, we gained assurance that Watmos is delivering the required outcomes. Engagement and scrutiny arrangements are designed to provide a wide range of meaningful opportunities for tenants to share their views and provide scrutiny. There is evidence that feedback from tenants and scrutiny reviews have influenced Watmos’ decision making.
Watmos has provided assurance that it makes effective use of its performance data to improve services and provides a range of information to tenants to support effective scrutiny. Improvements made as a result of scrutiny reviews by tenants include how Watmos manages ASB cases, damp, mould and condensation, and complaints.
We saw evidence of Watmos using its data to focus improvements where performance is lower across certain tenant groups, including through engaging with those tenants and using their views to influence improvement plans.
Watmos demonstrated that it treats tenants with fairness and respect and is continuing to increase its understanding of its tenants. Watmos 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.
Watmos 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.
Governance – G1 – April 2025
Watmos’ governance grade was downgraded in March 2021 because of weaknesses in stress testing and risk management, together with a need to strengthen the capacity, skills and strategic oversight of the board.
From the evidence-based assurance provided throughout the responsive engagement period and during the inspection we have assurance that Watmos has taken steps to enhance the skills of its board and operate a stronger risk management framework with appropriate stress testing. We gained assurance that Watmos now has an appropriate risk management and control framework that aligns with its identified strategic risks, alongside a risk assurance map identifying controls and their respective effectiveness. We have evidence that the board effectively monitors the delivery of strategic objectives through its performance framework and has put plans in place to remedy underperformance.
Watmos’ board is sufficiently skilled to deliver the organisation’s strategic objectives. Regular self-assessments against a skills matrix have supported effective recruitment to the board, leading to enhanced expertise in finance and risk management. The board has clear expectations of the quality of stress testing it requires and provides effective challenge on the level of assurance sought across the control environment. Through observations of the board, meetings with non-executives and executives, we saw evidence that Watmos maintains clear responsibilities and accountabilities within its executive and non-executive leadership structures.
Through our inspection we have gained assurance that the board has appropriate oversight of performance against strategic objectives including outcomes for tenants through performance reports, service reviews, scrutiny spotlights and the work of its committees.
Watmos has provided assurance that it reviews its corporate structure, and how this helps deliver an efficient and effective organisation in line with its charitable objectives, undertaking independent reviews of its governance arrangements.
Watmos is currently undertaking a significant change in its governance arrangements, and we saw evidence it is doing this in consultation with tenants and with appropriate external advice. Watmos has demonstrated it understands its assets and liabilities and takes steps to improve the value for money of its services.
Viability – V2 – April 2025
Based on the evidence gained from the inspection, we have concluded that Watmos has financial plans that are consistent with and support its financial strategy. Watmos has a business plan that is appropriately funded and has sufficient security in place to support its financial and business plans.
Watmos continues to meet our viability requirements but has a number of risks to manage over the short term so it can continue its investment in existing homes and reduce the potential to increase stress on its financial position.
Watmos has a financial profile that is not reliant on sales of new homes or efficiencies to meet covenant requirements. Its financial plans evidence that it has capacity to deal with a reasonable range of adverse scenarios and is able to deliver its development programme and stock investment.
Background to the judgement
About the landlord
Watmos is a small, community benefit society that owns and manages 2,615 rented social homes in Walsall and Lambeth.
It was formed by a transfer of seven tenant management organisations from Walsall Council in 2003, followed by a further three from Lambeth Council in 2012.
For the year ended 31 March 2024, Watmos employed 94 full-time equivalent staff and generated a turnover of £18.9m.
Watmos aims to develop 60 homes between 2023 and 2026.
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.