Council company 'could protect stock from RTB'
A Labour council hopes its new housing company will be allowed to buy the authority’s own vacant ‘high-value’ stock, preventing loss of homes to fund the Right to Buy extension.
Oxford City Council announced last week that it was setting up a new housing company to tackle the high demand for housing in the city.
In addition to building new homes, the authority also wants the new company to buy high-value council stock which would otherwise be sold on the market in order to pay the Right to Buy levy. However, it is not clear if the government will permit this, and the Department for Communities and Local Government declined to comment.
Under government plans, local authorities will be charged a levy based on a prior estimate of the number of high-value homes expected to become empty. The cash raised will replace council homes sold and fund Right to Buy discounts for housing association tenants.
The council will loan £12.5m to the company to fund its purchase of affordable housing at Barton Park. It will also build 885 homes on this site. The council will also provide up to £30m to purchase shares in the company and make loan advances in 2016/17, according to a paper that went to the council’s full meeting last week.
It will also develop new build housing on council land, buy affordable housing from developers on private land and undertake estate regeneration schemes.
The local authority said the decision follows the government’s proposed changes to housing and planning policies “that will make it more difficult for the city council to continue to build new affordable homes”.
These include the 1% rent reduction and a statutory duty to promote Starter Homes and include them within the definition of affordable housing.
The company is also expected to offer property management and repairs services to the private sector.
Mike Rowley, board member for housing, said: “The housing company will be a separate legal entity wholly owned by the council, with power to undertake anything a company can do and in particular to acquire and hold land and properties.”