READING Borough Council is bidding for funding to build another 170 affordable new council homes in Reading.
Reading is one of a number of local authorities in the country who recently submitted a bid to Government for more borrowing capacity in order to build new affordable homes for rent.
If the council is successful in its bid it could potentially provide new affordable council housing across a number of sites in Reading. The council is in the process of working up options for new council homes in a number of possible locations. Public consultation will take place with local communities over the next few weeks, once that work is complete.
With average house prices in Reading now at around £320,000 for a terraced house, high demand in the private rented sector means high rents, which can be over £1,000 per month for a two bedroom flat. Combined with credit checks, a requirement to pay hefty deposits and rent in advance and reluctance of some private landlords to let to people on benefits, many people find themselves struggling to access affordable housing locally, even if they grew up in Reading. More people are approaching the council for help after becoming homeless, or because they are in housing need.
Reading Borough Council has already delivered 78 new affordable homes over the past 2 years, in addition to those delivered by the council’s housing association partners. Another 151 council-owned homes will be delivered over the next 2-3 year period, including 57 new homes at Conwy Close, Tilehurst. The first of these should be ready for families to move into before Christmas. The new bids could bring the total programme to almost 400 new Council homes being built.
The national housing crisis has seen the Ministry of Housing, Communities and Local Government (MHCLG) announce opportunities for councils to increase borrowing within the Housing Revenue Account or HRA (*see notes to editor). Local authorities can also bid for grant funding through the Shared Ownership and Affordable Housing Programme, co-ordinated by Homes England. Reading Borough Council submitted its bids in late September. The winning bidders are expected to be announced this Autumn.
Councillor John Ennis, Reading Borough Council’s Lead Member for Housing, said:
“Like many other areas in the south-east, Reading is an increasingly unaffordable place to live for so many people. Rising house prices and private rents, combined with the Government’s welfare reforms, has seen more people approaching the Council for help after becoming homeless, or because they are in housing need.
“In light of the national housing crisis, Government has acknowledged that local authorities have a vital role to play in providing new council homes.
“The council has already delivered 78 new affordable homes, with another 151 Council-owned homes to be delivered over the next 2 to 3 years. This bid for more borrowing capacity will allow us to build significantly on those numbers with another 170 new Council houses, bringing the number up to 400 in total.
“Officers are currently in the process of working up options and local communities will be consulted over the next few weeks.”
The 2016 Berkshire wide Strategic Housing Market Assessment indicates that Reading needs to provide an additional 699 homes every year, of which 406 needed to be affordable. In a tight and expensive urban area like Reading opportunities to build new affordable housing are limited.
A report to the Council’s Policy Committee on October 29th seeks retrospective approval for the bids in light of tight timescales for submission. The full report can be found at: http://www.reading.gov.uk/media/9604/item07-LANBbidapproval/pdf/item07-LANBbidapproval.pdf
In total Reading Borough Council’s bids are for an additional £33,180,400 of borrowing capacity within the HRA and £7,920,000 of Affordable Homes Programme Grant Funding to support a £47,916,000 development programme.
Notes To Editor:
Housing Revenue Account (HRA)
The Housing Revenue Account (HRA) deals with Council housing finance. The main income is housing rent and all expenditure related to council housing (such as dealing with lettings; managing, maintaining and repairing the stock; collecting rent) is charged to this account. The Housing Revenue Account is ‘ring-fenced’ and separate from other Council activity, which is accounted for through the Council’s ‘General Fund’ account.