Families needing homes could soon be housed in privately rented properties if Cabinet Members approve proposals for a new leasing scheme.
The proposed scheme is a cost-effective alternative to the current method of providing temporary bed-and-breakfast accommodation, which has seen costs rising from £0.6m in 2022/23 to £8.1m in 2024/25. Under the current approach, the Council cannot claim the full cost of temporary housing through housing benefit subsidy regulations. Rented contracts for over 10 years will allow the council to claim the maximum of the housing benefit subsidy regulations, helping to alleviate the costs of providing temporary accommodation.
If the plans are approved, Derby City Council would rent 50 private properties from 1 to 5 years, or for more than 10 years. These would be a mix of 2- and 3-bedroom properties and would help the council to meet its legal requirements under the Housing Act of 1996 by providing safe, affordable, and quality homes for people and families.
Alongside alleviating financial pressures, the scheme offers significant benefits for households in need of accommodation, including more stability, privacy and autonomy, and appropriate facilities (such as cooking facilities).
Cabinet will also be asked to consider extending the scheme beyond 50 properties if there is an increased demand for temporary accommodation. As of 30 September 2024, 8,030 applicants were actively looking for affordable homes through the Council’s letting system, Homefinder.
Alongside this proposal, the Council has actively been looking for ways to mitigate the increasing cost of temporary accommodation, including the recently developed Abbey Lodge which has provided dozens of safe and secure flats.
To fund the scheme, members will be asked to approve a capital budget of £150,000 and a one-off revenue budget of £200,000 in the 2026/27 Medium Term Financial Plan (MTFP) to cover the upfront cost.
Councillor Shiraz Khan, Cabinet Member for Housing, Strategic Planning, and Regulatory Services, said:
We are facing a rising demand for housing, and Derby, like many other cities, is not unique to the growing demand across the country.
We are continuously working to reduce the number of households in bed-and-breakfasts and other temporary accommodations, which do not give families the stability and security that they need to thrive.
The private sector leasing scheme has been successfully implemented by various local authorities across the country. This new scheme will provide a consistent and safe environment for people and families by offering them high-quality homes which will also positively impact their health and wellbeing by keeping families together. The scheme will also deliver financial benefits for the Council.
If approved, the Council will engage with landlords throughout the process to raise awareness of the scheme so that they can make an informed decision of whether they wish to participate or not.
The Cabinet meeting will take place on Wednesday 10 September and can be viewed on Derby City Council’s YouTube channel.