Agenda item

Background:

The report set out that a Registered Provider (RP) of Social Housing was seeking to transfer their Medway housing stock [excluding two specific assets] to a new registered social provider, this being Medway Council, this was in line with the RP’s long term asset disposal strategy. Medway Council’s Landlord Services [Housing Revenue Account - HRA] had been advised of a potential RP transfer opportunity of social housing properties as part of this organisation’s larger asset disposal and rationalisation strategy. It was noted that HRA funding was ringfenced from the Council’s general finances.

The report sought approval to formally commence due diligence and recommend to full Council approval of the necessary capital budget to enable the transfer of the Medway portfolio of the Registered Provider stock to Medway Council’s HRA. Enabling an alternative registered provider to take ownership of the existing RP’s Medway properties and maintaining much needed social housing, it was important to note that the properties would be tenanted at the time of transfer to the Council.

Two Exempt Appendices to the report set out financial information, which was of a commercially sensitive nature and a breakdown of locations of the acquisition portfolio which was covered under a Non-Disclosure Agreement.

A diversity impact assessment had been undertaken in relation to the proposals and was attached as Exempt Appendix 3 to the report.

Reasons:

To secure an additional 569 units of social and affordable housing for Medway residents. These properties will form part of the HRA’s portfolio and give the Council control over how they are allocated, maintained and managed, ensuring that the tenants living in them have a safe, habitable home and good landlord who places them at the heart of the business.

To prevent the loss of social housing stock to other entities.

The HRA is one of the largest social housing providers in the area and is well placed to acquire and manage the RP’s Medway portfolio alongside its existing homes.

The acquisition aligns with the Council’s core purpose of providing social housing and strengthens the HRA by increasing the number of social and affordable home ownership units.

Analysing the asset data provided, these homes benefit from traditional construction, long?life components and low maintenance requirements, making them cost?effective to manage and supporting the long?term sustainability of the HRA.

The properties are located within existing management areas and can be absorbed into current operational teams without creating additional service pressures.

Tenants will benefit from having a local landlord with secure tenancy arrangements retained. Right to Buy eligibility will apply, with the Council’s investment protected for 15 years under national Cost Floor regulations.

Medway Council’s stock?acquisition programme has successfully added 169 general needs homes since 2016, plus 187 temporary and supported units. The HRA has a development and growth strategy with a target to grow the stock figure by at least 1% year on year.

Acquiring the RP portfolio represents the quickest and most cost?effective method of increasing supply compared with alternative delivery routes.

Based on the financial and asset data provided, the acquisition is financially viable and demonstrates a positive long-term impact on the HRA business plan.