Agenda item

[Report of the Director of Housing, Regeneration and Planning. To be introduced by the Cabinet Member for Housing and Estate Renewal.]

This report seeks approval from Cabinet to acquire the freehold portfolio of properties in Barnet from the International Bible Student Association (IBSA) and spend the sum specified in the exempt report on these homes.

The Cabinet Member for Housing and Estate Renewal introduced this report which sought approval from Cabinet to acquire the freehold portfolio of properties in Barnet and spend the sum specified in the exempt report on these homes.

The Cabinet Member was delighted that Haringey had the chance to acquire these homes which were mostly of family sized housing. They were good quality, they were for the most part family-sized and they would provide homeless households, or those needing supported housing, with somewhere to live that is safe, stable and well maintained – a place where individuals and families would have a better chance.

The Cabinet Member highlighted that if the acquisition were to be approved, these properties would be leased to the Haringey Community Benefit Society (the CBS) for a period of seven years to provide homes for homeless households or used to deliver supported housing for those with additional support needs.

The Cabinet Member closed by noting the report sought approval from Cabinet to acquire the properties and spend the sum specified in the exempt report on these homes.

Further to considering exempt information at item 24,

RESOLVED

1. To approve the purchase, for the price set out in the exempt part of the report, of the freehold interest in a portfolio of 92 properties from the Seller, for housing purposes and subject to satisfactory Legal and Strategic Property Unit due diligence processes, such as title checks, building condition surveys, servicing records and statutory compliance and agrees that the total sum to be spent on the purchase shall be the amount set out in the exempt part of the report.
2. To delegate authority to the Director of Housing, Regeneration and Planning, after consultation with the Director of Finance and the Lead Member for Housing and Estate Renewal, to agree the final terms of the acquisition.
3. To agree that these homes be leased to the CBS for a period of up to seven years unless the Director of Housing, Regeneration and Planning agrees their retention in Council stock for use as supported housing pursuant to 3.4.
4. To agree that officers investigate the feasibility of using a number of the homes as supported housing and delegates authority to the Director of Housing, Regeneration and Planning after consultation with the Director of Finance, the Director of Adults and Health, the Lead Member for Housing and the Lead Member for Adults and Health, on presentation of a business case to agree their use as such.

Reasons for decision

This acquisition represents an opportunity for the Council to secure 92 good-quality homes with a high proportion of family sized accommodation. These can be used to provide homeless households with temporary accommodation or long-term settled homes but may also be used for residents with support needs, subject to completion of the appropriate business case.

The portfolio consists of 20 one-bedroom, 64 two-bedroom, 2 three-bedroom and 6 four-bedroom properties. Once acquired the properties will be leased to the CBS and allocated to households under a Nominations Agreement.

These homes will represent a substantial improvement in the accommodation available to homeless households because they are significantly better in terms of quality and location than much of the temporary accommodation these households currently live in.

The nature of the tenancy that will be offered is also an improvement in the longer-term on some of the current offer, which is often limited to a two-year private sector tenancy with potential rent increases at the end of the tenancy.

The biggest demand in temporary accommodation is for two and three-bedroom properties. This portfolio significantly helps meet this demand.

While financial viability of this purchase is based on the provision of accommodation to households currently in temporary accommodation, there is also significant demand for supported housing which is either in or close to Haringey, so that residents can access local support networks. Where a business case can be made to use some of these properties in this way, this purchase could also offer a much-needed opportunity to secure sustainable supported accommodation, which provides users with stable housing to support increased independence.

The proposal to lease these properties to the CBS means the properties could be let (by the CBS) at current Government-set Local Housing Allowance rates which are below average market rent. These would be eligible for Housing Benefit and more affordable to working tenants than much of their current accommodation. Using the properties to reduce the need for temporary accommodation would also reduce the financial burden on the General Fund, representing a year on year budget saving to the Council. Similarly, the provision of supported accommodation in or close to the borough is a cost-effective way to support residents who would otherwise require more intensive care and support through adult social care, also funded from the General Fund.

The freehold acquisition of the properties would mean that the Council would not be charged any ground rent by a third-party freeholder. It would also ensure in the long term that all property and assets would remain within Council control. The nature of the portfolio provides the Council with a range of exit strategies at the end of the seven-year lease, in addition to bringing them into use as Council tenancies. These include potential changes to the tenure of the properties and/or disposing of all or part of the portfolio at the end of the seven-year period to ensure the viability of the homes in the HRA.

The acquisition of this portfolio also provides the Council with an opportunity to use its retained Right to Buy (RTB) receipts to acquire homes to use as social housing. Such receipts could otherwise become repayable to the Ministry of Housing, Communities and Local Government (MHCLG) if they are not spent within the statutory timescales. The Council’s RTB receipts are not being used to fund new build properties, because they cannot be used in conjunction with the Greater London Authority (GLA) grant secured for this programme.

Alternative options considered

Not completing the contract to acquire the properties: This option was rejected because of the quality of the portfolio. They are excellent quality homes which the Seller is bringing up to a good standard comparable to the Council’s Decent Homes plus standard. They also provide a good mix of family homes in locations close to public transport and local shops and facilities.