Council tenants to get a new landlord

Sep 27 2008 by Brian Daniel, The Journal

ANORTH council has rubber stamped the transfer of its housing stock, saving the authority £7.5m.

Berwick Borough Council approved the actions taken to achieve the “successful transfer” of 2,000 authority owned homes to a registered social landlord.

Berwick Borough Housing (BBH) will manage the stock in partnership with the Three Rivers Housing group, under the banner Four Housing Group, once the changeover is complete on November 3.

At a full council meeting this week, members were told that the Department for Communities and Local Government (CLG) says the authority is transferring the homes at a time when they require £7.5m investment.

This figure was arrived at in view of the tenanted value of the stock, rental income over a 30-year period, the condition of the stock and the value of works required to bring properties up to the government’s Decent Homes Standard.

However, the government department has agreed to provide £7.5m to Berwick Borough Housing from its Gap Funding pot, to invest in the homes over a five- year period.

A report from the council’s director of environment Rob Marriner and head of property and housing Mike Haynes said: “Having taken into account the tenanted value of the stock, rental income over a 30- year period, the condition of the stock, and the value of works required to bring properties up to the government’s Decent Homes Standard, Berwick’s stock was found to have a negative value of £7.534m.

“Representation was made to CLG for financial assistance from the government’s ‘Gap Funding’ pot. Successful negotiations resulted in CLG permission being granted on this basis, and as such BBH will receive a dowry of £7.534m over a five-year period.”

The council opted to pursue transferring its housing stock after realising it could not afford the £100m needed to bring the homes up to standard, and that they would become a liability. It acknowledged that a new housing association would be better positioned to invest in the stock to the benefit of tenants.

The authority subsequently appointed Three Rivers as the housing group which would take on the homes. It held a ballot of tenants last year, at which 78% voted in favour of the transfer.

And the council has already lent £1.335m to Berwick Borough Housing to help with running costs and ensure the transfer goes through.

This was initially due to take place in August but was delayed to November.

Certain housing-related functions will remain the responsibility of the council once the transfer is complete, including maintaining a housing register and dealing with homeless people, as well as issuing grants and preparation of a housing strategy.