A Micro-Market for Vacant Housing

A London company matches flexible tenants with landlords who would otherwise be sitting on empty buildings.

Image
Julia Levitt

Vacant buildings can languish for a variety of reasons. Some are chronically disused: a neglected property falls into disrepair, making it a liability that is eventually more expensive to fix than to ignore. For others, leaving units empty is a management choice. When rent-controlled apartment buildings are slated for refurbishment or re-purposing, for example, the process of moving tenants out can take years, with the first units vacated remaining useless until the process is finished.

In London, which has its fair share of blighted properties, one organization is working on a solution to the city's housing waste problem by offering community-minded individuals the chance to live cheaply in apartment homes that would otherwise sit empty. Dot Dot Dot Property Guardians has plenty of raw material to work with: slightly more than 3 percent of the total housing stock in England (more than 700,000 homes) was reported empty last year by the independent non-profit Empty Homes Agency (figures, based on council tax data, do not include homes deemed "uninhabitable," homes slated for demolition, or apartments above storefronts which, though habitable, are counted as commercial property). Of these, 39 percent had been empty for more than six months. Despite a nationally recognized housing shortage, many landlords still find it preferable - financially, legally, or as a matter of convenience - to keep homes unoccupied.

Julia Levitt

Renting these properties encumbers many owners' long-term plans, so Dot Dot Dot takes advantage of a legal loophole by vetting and placing live-in "guardians" in the properties. Guardians are people who are willing to exchange traditional tenants' rights — their stay can be terminated with only two weeks' advance notice — for reliable space at a fraction of the typical cost.

Legally, guardians share a status similar to someone employed to service the property, such as a professional house cleaner. As such, they don't technically pay "rent," but instead pay a management fee to Dot Dot Dot -- on average £50 per week, about a quarter (or less) of the typical cost of a shared flat in London. Property owners also pay a management fee to Dot Dot Dot. Owners don't earn income from the arrangement, but installing guardians often prevents neglect and vandalism (plus, says founder Katharine Hibbert, it can be good PR).

The business model itself is not new. Established players in property guardianship include European companies Ad Hoc and Camelot. Dot Dot Dot, however, attempts to differentiate itself with an element of social benefit. Its competitive screening process for guardians is designed to select those who will be "great neighbors," actively contributing to the communities where they live. "We manage intensively," says Hibbert, 30, who sets up her clients in peer groups to encourage them to share resources and meets with them regularly to check on their welfare and community projects.

So far, the new company is on a positive trajectory, Hibbert says, enjoying support from an advisory board that includes affordable housing advocates and legal professionals. Since its launch last summer, Dot Dot Dot has established contracts with several private property owners and two housing associations, with more on the way. Hibbert expects to begin to see profits by the fall.

Dot Dot Dot doesn't endeavor to be a full-spectrum solution to the problem of housing need. It serves a relatively homogenous population of potential guardians — mostly young, unattached recent college graduates who are flexible enough to handle the uncertainty of tenure. Guardianship does, however, present a scalable alternative to leaving properties shuttered, and offers a relatively safe and stable independent housing situation for younger adults with lower salaries.

Measuring a soft variable like social contribution presents its own challenges. Hibbert is considering asking participants to self-document their investment in the community by blogging, which she hopes could motivate them to stay involved over time.

The arrangement raises a question of balancing permanence with necessary impermanence: what if, after months of engagement, guardians become so beloved by their communities that their neighbors object to their moving on?

"That," says Hibbert, "would be quite a nice problem to have."

About the Author

  • Julia Levitt writes and consults on sustainability, policy, innovation, and strategy in the built environment. She is currently studying management at the London School of Economics.