ALMOs seek to borrow against rental streams
Arm's-length management organisations are working up proposals for the Treasury on allowing them to raise money by borrowing against their rental streams.The Office of the Deputy Prime Minister had hoped to bring out its consultation paper on freedoms and flexibilities for ALMOs in July – but the process has been delayed.ALMOs cannot borrow against the value of their stock, as housing associations do, because they do not own their homes.Gordon Perry, chief executive of the Kensington & Chelsea ALMO, said it was very early days. Two obstacles had to be overcome: that ALMOs did not own their homes, and that any borrowing may count against the public sector borrowing requirement.‘We are looking at other alternatives such as borrowing on rental streams, and we have had fruitful discussions with the Council of Mortgage Lenders,' he said. ‘It is another take on securitisation – but it is too early to say how it would differ.‘We are not just waiting on the results of the freedoms and flexibilities discussions with the ODPM.'
‘ This raises the question of whether ALMOs are just about decent homes'