Liverpool is forced to write down value of homes as funding is cut
Pathfinder delays hit stock values
Liverpool Council has written down the value of stock on one of its estates by £8.1 million as spending cuts stall regeneration plans.
The move has sparked fears that northern councils will be left with recently bought stock plummeting in value that they can’t demolish because of cuts to the housing market renewal pathfinder programme.
A freedom of information request to pathfinder New Heartlands shows that Liverpool Council is writing off the value of houses in the Welsh Streets area of the city by 19 per cent each year. The 335 houses were bought for £17.6 million between 2005 and 2009. Now they are worth around £9.5 million, meaning £8.1 million of public money has been wiped off their value.
A total of 295 homes were earmarked for demolition in September but the work has been hit by delays due to uncertainty over funding.
David Ireland, chief executive of charity Empty Homes, said: ‘The council will be selling that land at notional prices, well below what it paid for it. If they write down the price over several years then it means it looks like they are selling it off for the right price.’
The government announced in October that it will end dedicated grant for the programme and instead merge funding into a new £1.4 billion regional growth fund.
Brendan Nevin, interim managing director at New Heartlands, said following the announcement that he fears the £1.4 billion is not enough to allow pathfinders to complete existing projects.
Several pathfinders are due to close while others will scale back their programmes.
Pathfinders were set up in 2002 to fix failing housing markets in the north of England. The programme has seen 21,765 homes bought by authorities and 20,586 knocked down, according to figures from the Homes and Communities Agency.
Pathfinder Gateway Hull has bought 1,031 homes for demolition but needs funding to complete its clearance programme. A spokesperson said: ‘These incomplete clearance areas impact on the surrounding areas, with the potential to spread blight and undermine all the value of investment to date.’
Tony Humphrys, cabinet member for housing at Blackburn with Darwen Council, part of Regenerate Pennine Lancashire, said: ‘It worries me that there will be half-finished projects everywhere. Some of the work that we’ve done in the housing department might suddenly mean nothing. We’re working with local housing companies to see if they can provide funding.’
A Liverpool Council spokesperson said the new valuation of the Welsh Street homes reflects market conditions and the condition of the homes.