Huge investment to fund 400 new council homes
Published on Wednesday, November 6, 2019
£70 MILLION is set to be invested in building and buying properties to create much-needed new council housing across the city.
Leicester City Council is planning to invest the money as part of a commitment to create 1,500 new council social and supported living homes by 2023.
The latest money – made up of a combination of Right To Buy receipts and borrowing – would enable the creation of up to 400 more new council homes, with affordable rents, in order to help ease the strain on the city council’s housing waiting list.
The investment has been put forward by the City Mayor Peter Soulsby as the latest in a series of actions designed to tackle housing need in the city. It is being recommended for approval at the next meeting of Full Council, on Thursday, November 14.
The city council owns around 20,000 council homes, and there are currently around 6,000 households on the city’s housing register.
A total of 786 new affordable homes is needed each year to meet demand, but until recently Government constraints on how the city council can fund the creation of new homes have meant it has only been able to provide an average of 125 extra homes per year.
However, the Government relaxed its rules in October 2018 following extensive lobbying by councils, meaning authorities can now borrow money more easily to pay for new housing.
The £70million would be made up of approximately 30 per cent (£21million) of Right to Buy receipts, which is the maximum allowed by the Government, with the remaining 70 per cent (£49million) coming from a mixture of the council’s Housing Revenue Account and borrowing.
Investing the money into new housing also means the council does not have to return any unused Right To Buy money to the Government.
The investment is the latest phase of work to create new affordable social housing across the city.
Since 2018, Leicester City Council has approved over £36.3million of spending both to create new council homes, and acquisition of existing properties to transform into council housing.
As of September 2019, the council had purchased 141 homes, with another 42 in the process of being purchased, to create a mixture of family homes, bedsits, flats and bungalows.
A programme of council house building is also underway, with work due to begin on six sites across the city. The first phase of creating 29 new homes is already underway, with progress also being made on a further 100 units.
In addition, a further £22million programme of housing repairs, maintenance and adaptations to the city council’s housing stock is in progress to improve homes and bring them up to modern standards with new boilers, bathrooms and kitchen, as well as wiring, electrics, roofing and windows.
Leicester City Mayor Peter Soulsby said: “The Government’s Right To Buy scheme has meant we’ve lost thousands of council properties over the last few decades, depleting our housing stock at a time when affordable homes are so badly needed.
“But by reinvesting these Right To Buy receipts into building and acquiring properties in the city itself, we can provide housing where it is needed most. The relaxation by the Government of its rules on borrowing to fund new housing also means we can invest properly in making new council homes available in the kind of quantities needed to meet demand.”
Leicester assistant city mayor for housing and education, Cllr Elly Cutkelvin added: “This investment would be a big step towards meeting our commitment to provide new affordable council housing.
“The £70million would enable us to build new council homes, purchase existing privately-owned houses, buy land or other properties suitable for use as council housing, and also to carry out work needed to bring these buildings up to modern letting standards.”