Making housing secure: how a trust is reshaping refugee resettlement in Edinburgh

How does a volunteer-led group become a housing innovator?

In part two of our short series on the work of the Edinburgh Refugee Sponsorship Circle with their approach to tackling the housing issue –  we explore how they’re using a discretionary trust model to secure long-term, dignified housing for a resettled family — while building community wealth and resilience. We talked to Fae Gerlach about the trust they’re setting up – ‘Edinburgh Community Sponsorship Homes’.

Why did you land on a discretionary trust as the best model for this project?

Fae:  We’ve spent the last two years thinking for solutions. Obviously there’s lots of legislations and regulations so we knew we couldn’t do an investment type of thing, because we’re not a regulated body. We’d been advised legally by our solicitors and by experts and lawyers and then we had to find a way as secure for the Edinburgh Refugee Sponsorship Circle as possible. There’s the option of loan agreements but that could potentially be very risky for a small charity like ERSC.

We looked into mortgages, but we wouldn’t have the capital for a long period of time, so mortgage agreements with the bank would be very tricky. We tried to find ways to best utilize having a different a group of people who want to put money together, but a group of people that’s a little bit contained. It would obviously mean relationship building, and looking at how to balance issues: like how can we attain the most security for the family along with, how can we have an offer that creates enough trust for people to put their money into this, obviously, with the hope that it doesn’t disappear. So the discretionary trust was the outcome from many, many hours of conversations, and research.

Can you basically just very briefly explain how the Trust works in plain terms for somebody who’d never come across the idea before.

Fae: So the idea of a Trust is that a group of people put money together into a pot. It’s called a Trust, and is governed by trustees. So we will have some amazing trustees who thankfully have agreed to come forward who have lots of experience, and that Trust will then use that money, to purchase the flat where the family lives at the moment, in January next year, hopefully, or whenever we’re ready. And then the rent would go towards the Trust. So everything, all income from owning the property, would come into the Trust. The Trust would be the legal landlord. And so, you know, would have those  responsibilities, and then regular terms that are to be the agreed once the Trust is set up, and they would be sort of a payout to people who have contributed. So they they’re contributors to the Trust, and then they become beneficiaries of the Trust. And that can be quite flexible in terms of how that can look. And then after the 10 years that we are  aiming for, (we’re aiming for to create 10 years of security). Then, if the property is sold,  then that money would, then, could then be paid out to the older beneficiaries according to their sort of quantities of what they’ve put forward.

And how did you go about shaping the legal and financial structure? Were there any models or examples that inspired you?

Fae: I mean, we’re doing something quite special. So we did have to really figure out what to do, really get really solid advice, and it’s been amazing. Lindsay Solicitors have been brilliant in advising us. So we had some examples of Community Sponsorship groups down in England who had done something like a declaration of trust, and that was for a more temporary situation. I think the families arrived there and then moved on. We learned a lot from LA Housing Trust, who’s a massive housing trust here in Scotland, who think they’ve gained, they got a big government loan at some point, and have been building properties, and they’ve been taking us under their lead a little bit and advised us. And so we learned quite a lot about thinking bold and also about how realistic it is. I think that was the main thing, you know, actually talking to people who do it, like, literally, just knowing, like, it’s possible, and it’s actually like, for people who’ve done it on a big scale, they’re like, yeah, absolutely, it’s a great idea. We’ve heard from two Catholic nuns in England who started buying housing and homing resettled families through the council, together with women who are escaping domestic violence, which is a beautiful concept, and that seems to be going really well. We’ve had inspiration from different places, but I guess one thing is that we all volunteer. So those housing trusts we’ve looked to are led by employee employees and paid staff. So we are  doing something that is completely community-sourced and community-run. So, yeah, that’s like, an amazing part.

Why was it important to set social rent levels, and what does that mean for the family involved?

Fae: That was also a long discussion, because we’re obviously trying to balance this to be an attractive thing to put your money towards, and then the orientating towards the rent that someone would pay if they were in a council setting, or in a social housing setting. We’re aware that for many families who are privately renting or who aren’t on Universal Credit, for example, and who are affected by the benefits cap and all of those  things, higher rents can mean that they can be more easily trapped on certain benefits. And so that was a big inspiration for us. How are we creating an environment, a living environment that’s also the most conducive to people really being able to freely explore their pathways and their employability, so without massive financial fears and precarity. So that was one of the reasons. But we were also really thinking around what can really, really target the housing emergency? And the housing emergency is around that there are not enough of this type of accommodation.

So we’re trying to match the initial donation, and we are in the process of motivating people to contribute to this. We’re not at the full amount yet. We’re getting there, but we’re trying to see this as our Plan A with an option then to see, okay, we could potentially raise the rent, but it makes it the most transformative and a really radical alternative to just hoping that the council will get more flats or build more flats. We’re trying to find people who are really happy with, not at a loss whatsoever, but put their money in, but make a little bit less of a win than they could on the Edinburgh market.

And how does this approach offer more dignity or stability than other housing routes the refugees families might face?

Fae: I think for anyone who has experienced it, or has supported people who moved through temporary housing, or who are moved into council housing, the process is horrendous. On many, many ways, it’s profoundly stressful. It is not trauma-informed, and you have quite a range of quality when it comes to temporary housing and council housing, and that can be very shockingly bad quality, and often now people do not get the money any more for equipping the houses. So you have a significant pressure then to make the housing livable, really. And the community grants are in short supply now. One of the key crises in Edinburgh at the moment, and probably in many other places as well, is the situation of people who are on those long, long waiting lists and who are in temporary accommodation without cooking facilities or without the proper, you know, facilities for children. For children to be able to do their homework and to live in a way, to bring their friends, but then also having to move on to into council accommodation, and then that accommodation being below standard. We have to have a lot of understanding of why the council is in that crisis, and they’re working really, really hard to address that and the resettlement team as well, but we were just aware what that would mean for that family, and so we’re really, really motivated to really create an alternative path for them, and then hopefully for other people as well, and take pressure off the council. We are dependent on the approval of the Council for further community sponsorship. And we’ve been really, really lucky. We have an amazing Council team who have been approving our new applications, because we’re welcoming a new person now and working on a fifth arrival. So we’re obviously depending on the Council to continue to give us approval, and they have been struggling with the fact, you know, how they can justify that towards the housing colleagues, which I can very much understand, you know, given that we would bring in more people when there’s already a shortage and so a bit of a informal condition, or a way for us to ensure that we can continue welcoming people is that we are really working hard on securing reliable, long term housing. One direction can be through finding private landlords, who are able to do this, but as we see with this case, eventually they might need to sell. And so I think our future lies in doing what we do best, Community Sponsorship and welcoming people and supporting people but in parallel to that is also to look into housing and, bringing more property into like, into social hands and into community-powered hands.

You’re contributing financially to the trust. Why was that important to you?

Fae: I mean, it was an amazing opportunity that we had never expected to have. We basically got a very, very generous donation of £80,000 for this purpose, freely given to us. We had never thought that we would be in the position to be part of it like that. So contributing ourselves to the Trust was really important, because it shows our commitment to securing housing and shows how we are not just focused on the bringing people over. We are also committed to solving the emergencies and the crisis’s that are here in our communities. So that was important for us. And it also obviously comes with the benefit of us being part of the beneficiaries, in terms of having the best interests of the family strongly at heart. We also have flexibility around, returns to us, or the finances that we put in that we can  use and in a more flexible way towards our charitable aims. And of course, in the end, the being a beneficiary of the fund and of the trust. So receiving funds at times that we can freely use, but also then after 10 years it really gives us a long term thinking that we’ve never thought we’d be able to have. There is a significant positive future in this, because obviously there’s going to be returns. That means that we don’t need much every year to really run our community events, to do the support, but it will go into welcoming more families and supporting more families. So it’s a it’s a win. A win, win for everyone.

You’re asking people to contribute in two ways. One is donors and as trust contributors and what  people or values do you hope will align with this call?

Fae: Of course, donations are always amazing, because every donation means that we can add to the £80,000 and every additional pound that we are contributing will obviously mean that we are less reliant on finding more people, and we’ll have more ability to do more work with refugees here, more work around Community Sponsorship. It’ll give us more potential to look into securing more property further down the line. Particularly because when you’re volunteer run, it means that the full amount goes into really transformative change. We realise that an £80,000 donation doesn’t come every day, and also that we are in not the best economic time. So we’re excited that we can also offer different routes that are not as charitable, you know, in that sense, but that hold the benefit for the person putting money forward. But that’s still a really value based and where people can create some significant change with the money that they hold. So I guess who we’re looking for, and what we’re hoping for – is people who have a bit of money spare, and who can make a liberated choice of where to put that money. We’re looking for people who understand the importance of housing security and how significant housing security can be for a family, and who are willing to  put their money somewhere where they might not get huge returns. You’re not going to get the same kind of return as you would by going down an investment route, or buying property and renting it out at Edinburgh Fringe  prices, or through a short-term lets but this will create a significant change for both a charity that’s supporting people arriving here, but also obviously for the family, right? A different kind of return.