Agenda item

Cabinet discussed proposals for the Council to progress with the acquisition of 137 new affordable homes being built by developer BDW, using the accelerated housing programme capital budget that had been approved by Council at its meeting on 12 October 2023. Cabinet also noted that the acquisitions are dependent upon the council securing sufficient Homes England Grant to make the project financially viable. Cabinet also noted that this project replaced the previously approved project to acquire 32 section 106 affordable homes at the same site.

It was further discussed that the Director of Corporate Services be delegated authority to re-assess the viability of projects within the programme and subsequently approve a variation to the assumed level of borrowing or other funding needed, in consultation with the Deputy Leader and Cabinet Member for Housing. This was if the assessment showed that the schemes remain viable and remain within the overall approved budget. Any changes in funding would be subsequently reported back to Cabinet. The letting of these homes would be in accordance with the Council’s Allocations Policy and any subsequent local lettings plan (LLP), at an affordable rent as set out in the council’s Tenancy Strategy.

Cabinet’s acquisitions strategy began through the realisation that the Council was losing highly valuable Section 106 units, known as affordable housing, simply because Housing Associations and Registered Providers were not taking them on. This was a national problem that Cabinet had already tackled, by ensuring that any units that would be lost were now taken into the Council’s housing portfolio, so that the valuable 106 units that private developments needed to provide were retained.

As Cabinet had moved through this strategy, its abilities and financial understanding had allowed the Council to extend its acquisitions strategy further; in this case allowing it to purchase 137 units that otherwise would have been private units and unaffordable to residents in need. In October 2023, Council approved the accelerated affordable housing development programme, acknowledging Cabinet’s determination to construct or acquire 400 new Council homes by the end of Labour’s first term. Now almost at October 2024, the Council was now very close to those 400 homes being agreed at the end of the first year of the current administration.

There were roughly 1500 families on the Council’s Housing Register, with the number changing every day. There were over 300 households in Temporary Accommodation, which not only caused huge emotional and social strain for those households, but also produced extraordinary strain on the general fund. This was because Temporary Accommodation costs required an extra 1.5 million from the general fund, none of which went towards assets, or producing stable homes for residents, as all of it left the Council.

As a result, Cabinet was continuing to proactively look for opportunities to acquire homes, as it was strongly felt that securing a robust pipeline of homes was one way in which the Council could, through local lettings plans, reduce its reliance on the expensive use of nightly paid temporary accommodation. Fifty percent of the new homes would go to those on the Council’s Housing Register, with the other fifty percent going to those who were also in Temporary Accommodation. This meant that these homes, when in use, instantly remove temporary accommodation costs.

To enable an acquisition this significant, Cabinet had to look at how best to deliver affordable housing at scale and this acquisition would mean that the Council did not proceed with a decision it sought, and that was approved, at Cabinet in July. In July 2024, officers sought the approval of purchasing 32 s106 homes at this site. Those homes would now be acquired by a registered provider specialising in shared ownership homes. These would not be lost as affordable homes, but using Homes England funding to purchase market homes allows Cabinet to purchase at far greater scale, whilst still maintaining mixed tenure delivery of affordable housing.

Councillor Davis and Councillor Bayford spoke under Council Procedure Rule 20.1.

Councillor Whitehead proposed, Councillor Keen seconded and Cabinet agreed the following:

1.  That the Council progresses with the acquisition of 137 new affordable homes being built by developer BDW, using the accelerated housing programme capital budget, approved by Council at its meeting on 12 October 2023;

2. That Cabinet note that the acquisitions are dependent upon the council securing sufficient Homes England Grant to make the project financially viable;

3. That Cabinet note that this project replaces the previously approved project to acquire 32 section 106 affordable homes at the same site;

4. That the Director of Corporate Services be delegated authority to re-assess the viability of projects within the programme, and subsequently approve a variation to the assumed level of borrowing or other funding needed, in consultation with the Deputy Leader and Cabinet Member for Housing, provided the assessment shows that the schemes remain viable and remain within the overall approved budget. Any changes in funding will be subsequently reported to Cabinet;

5. The letting of these homes in accordance with the Council’s Allocations Policy and any subsequent Local Letting Plan (LLP), at an affordable rent as set out in the Council’s Tenancy Strategy.