Havering Council’s Cabinet has formally approved the establishment of a wholly owned community interest company (CIC) to manage private-sector leased housing.
CICs are limited companies which operate to provide a benefit to the community they serve.
With the demand for local social housing higher than supply, the new management company will be part of the Council’s efforts to increase the stock of affordable properties.
Urban Impact Ltd will acquire properties (on a freehold or long leasehold basis) from the open market and lease the properties to the Council for a term of 10 years.
The properties will reflect the borough’s social housing demand based on the needs of applicants.
By the company leasing these properties on behalf of the Council, it will reduce the cost to the Council by up to £13 million over the 10-year period.
Last year, the Council was forced to overspend its temporary accommodation budget by £6 million.
Patrick Odling-Smee, Director of Living Well, Havering Council, said:
“The Council is committed to delivering good quality affordable homes for families in need in the borough.
"However with demand outstripping supply, we have to develop alternative options to source properties that reflect the needs of housing applicants.
“The new company arrangement will be able to let the property on an assured short-hold tenancy, which is financially advantageous compared to the other costs incurred from temporary accommodation.
“Establishing the new management company will mean we can let the homes, on affordable rents, to local families.”