An East London council is looking to buy six flats in a neighbouring borough as it doesn't have enough homes to accommodate a growing number of homeless families in the borough. The London Borough of Newham now has the highest number of households staying in temporary accommodation in the entire country, which has placed a 'significant financial burden' on the council, according to a cabinet report.
As of the beginning of April 2023, Newham had 5,883 households staying in temporary accommodation, with 3,198 of these staying in nightly booked properties. Newham Council said a major cause of this is down to local residents being priced out of the private rented sector in recent years and that a number of households are unable to receive an offer on a social rented home due to the borough's large housing waiting list.
Council officers said in a cabinet report: "The cost of maintaining households in emergency accommodation is a major budgetary pressure given the provisional out-turn overspend of £7.39 million in the 2022/23 homelessness budgets.
"Current expectations are that the general fund will experience further increases in costs into 2023/24 due to the aforementioned factors, which has been factored in to the 2023/24 budget proposals agreed at cabinet in February 2023."
The council is looking to buy six flats in Limehouse, Tower Hamlets, and would rent these to homeless Newham residents at a rate according to the London housing allowance. However, later on in the cabinet report it said: "Up to a maximum of half of these may be let at open market rents in order to ensure that the acquisition continues to meet the council’s agreed financial metrics, given the rising cost of capital as interest rates rise."
The six flats consist of four studios/one-beds and two three-beds. Newham Council is already providing nightly paid accommodation to 81 families in Tower Hamlets. If cabinet members approve the recommendations, the council intends to lease the flats to a third-party housing provider such as Future Newhome or Local Space, who would be able to let them on assured shorthold tenancies.
The report will be presented to Newham Council's cabinet members at a meeting next week (Thursday, June 8) and has been recommended for approval.
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