Up to £10m could be lent to council-owned housing company for affordable housing
Up to £10m could be lent to a council-owned property company in a bid to boost the availability of affordable housing.
Flintshire Council plans to borrow the money which it will then loan to North East Wales (NEW) Homes and Property Management over the next 10 years.
The authority became the first in Wales to set up its own housing company in April 2014 and is the sole shareholder of NEW.
Following the completion of the new-builds in April 2018, where more than 62 affordable houses and apartments were built as part of the Walks scheme in Flint, proposals are now being developed for a further 39 properties in an as yet unnamed location.
Councillor Sean Bibby, who is deputy chair of NEW, hailed the success of the scheme and said that annual surpluses generated will be returned to the council for reinvestment.
Addressing members of the council’s community and enterprise overview and scrutiny committee on Wednesday, he said:
“The company was established to increase the quantity and quality of affordable housing available in Flintshire; increasing housing choice for those who may not qualify for social housing but for whom market housing is unaffordable or difficult to access.
“This work has been supported by independent expertise and challenge and after detailed consideration and risk analysis was approved by NEW Homes Board on the 12 March 2018 as an achievable and sustainable plan for growth over the next ten years.”
In addition to building new homes, the company also provides a professional service to landlords, acting as a managing agent to increase the supply of quality affordable housing.
Rent levels are set at 10 per cent below market level to ensure affordability and landlords are charged a 10 per cent management fee.
However, Cllr Bibby admitted that growth in this area had been difficult with only 31 properties signed up.
He said: “Growth in relation to its managed lettings offer has been slow in 2017/18 and with the emergence of Rent Smart Wales and the highly competitive nature of the market within this sector, other landlords can charge higher rental fees and can pay less than 10 per cent management fees with other residential letting agents.
“The company, however, has been successful in that it has retained the majority of landlords once signed.”
He added that the cost of running this service is currently being reviewed.
By Liam Randall – BBC Local Democracy Reporter.
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