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Council to invest £150million to help tackle homelessness

An ambitious new plan has been approved to increase the supply of temporary accommodation in the borough, tackle the growing crisis of people at risk of homelessness and save money.

The plan was approved by Ealing Council’s cabinet at a meeting last night (Wednesday 7 February).

It will see £150million invested in properties which can either be turned into much-needed temporary accommodation for households that have no option but to turn to the council for support, or enable those who have already been accommodated in other temporary accommodation to move on. This will mean that fewer households will need to be placed into bed-and-breakfasts or, as has been the need more recently, into expensive commercial hotels.

Acute shortage of affordable housing

Our borough’s acute shortage of affordable housing for rent has been exacerbated by the steep rise in inflation and interest rates and subsequent cost of living crisis that we have seen in the last 19 months.

Many private landlords have chosen to leave the market because of buy-to-let mortgages becoming more expensive, and many of the remaining privately rented homes in the borough are unaffordable for people on housing-related benefits.

Many bed-and-breakfast operators have also pulled out of the market for similar reasons. Prior to the pandemic, thanks to the council’s continuing focus on preventing homelessness in the first place, the use of bed-and-breakfasts to house people was at its lowest levels since 2014. In the last financial year, Ealing was the best performing borough for homelessness prevention in London. But now the remaining bed-and-breakfasts are full, and the council is currently temporarily housing more than 200 families in commercial hotels.

At the same time, high rents, interest rate spikes, and a freeze in housing benefit levels have led to a sharp rise in the numbers of people who approach the council for help because they are at immediate risk of homelessness.

There is a ‘double-whammy’ of increased demand and reduced supply of suitable homes.

‘More homes are urgently needed’

Councillor Peter Mason, the leader of Ealing Council, said: “We are making great progress towards the council’s target of delivering thousands of new and affordable homes, with one of the strongest track records in London, and we are also one of the top performing boroughs in the capital in preventing homelessness. But the situation with temporary accommodation is becoming an emergency, and more homes are urgently needed for these most vulnerable of residents.

“We’ve asked the government to step up its support, but we find ourselves having to create our own solutions. Our plans to purchase more property to use as temporary accommodation is just one of many actions we are taking to tackle the housing crisis. We are also pushing on with our plans for thousands of new affordable homes to let across the borough, building better neighbourhoods and improving lives for all our residents.”

The soaring cost of temporary accommodation

Buying properties to turn into safe, secure temporary accommodation is a prudent, cost-effective solution. The cost of temporary accommodation places a significant pressure on the council, with numbers of people being placed there having more than doubled between 2011 and 2019 – and risen steeply in the last 18 months. The cost of placing a household in a commercial hotel has increased from an average of £2,298 per month in April 2023 to £4,202 in October 2023.

This approach will help reduce the number of families who need to be placed in accommodation without access to cooking or laundry facilities and lessen the need for families to move frequently from one place to another.

The plan is a scaling-up of similar property acquisition schemes undertaken by the council in the past, including that of Aspect House in Acton. The Aspect House scheme provided 31 new flats, a mix of 1, 2 and 3-bedroom homes. All of these homes have been provided to tenants who may otherwise have been at risk of homelessness.

‘Decent, safe, and secure accommodation’

Councillor Shital Manro, the council’s cabinet member for good growth and new housing, said: “Those in need of temporary accommodation are amongst the most vulnerable of our residents, and many are in a really desperate situation. The council has a legal duty to provide housing in many of these cases, but our plans are about much more than that. This is about making sure that all of our residents can live in a decent, safe, and secure environment where they can get back on their feet.

“Financial costs are important, and we will be very careful with any investments that we make, but so too is the human cost of the housing crisis. We have already seen the difference that good quality temporary accommodation like Aspect House can make to its residents’ lives. These new homes will provide the fresh start that our residents deserve.”

Financial checks

All purchases will be subject to a series of stringent financial checks to make sure that that they represent value for money, including independent valuations. The purchase cost, together with property maintenance and other running costs, is expected to be covered by rental income over the medium to long term, with any profits after repayment likely to be reinvested in more accommodation.

New properties purchased under this scheme will also contribute to the council’s efforts to tackle the climate crisis and will need to meet key sustainability criteria including energy efficiency performance standards.

All cabinet decisions are subject to a call-in period.

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