A new housing company which could help thousands of people on to the property ladder is set to be established by Liverpool City Council.
A report to the Cabinet on Friday 24 June asked permission for the city council establish a local authority owned, commercially driven ‘for profit’ company which, over the next few years, would develop houses on land owned by the council and the public and private sector across the city for sale and rent.
The aim is to provide new routes into home ownership for people by developing new starter homes, rent-to-buy properties and shared ownership schemes. The company would also act as a high quality, commercial, private landlord.
Under rent to buy, tenants purchase the property at a discount after a period of time funded by the increased value and an equity contribution built up through the rental.
The city council would maximise construction employment opportunities for local firms and apprentices, and profits made by the company would be recycled back into supporting wider council services.
Mayor of Liverpool Joe Anderson said:
“We have done an awful lot to increase the range and choice of housing in the city over the last few years by working with housing associations and developers, as well as through our innovative Homes for a Pound scheme.
“Our success in creating more than 5,000 new homes with private and public sector partners has improved life for thousands of residents and is generating valuable council tax income to help offset cuts in our funding from Central Government.
“However, despite this work, I am acutely aware that there are still far too many people simply can’t get a foot on to the housing ladder in the areas where they want to live.
“This is an opportunity to use our knowledge and land to build properties which boosts employment, while at the same time helping people into their first home.”
The company would not rent properties out on a social housing basis or seek to compete with housing associations.
Councillor Frank Hont, Cabinet member for housing, said:
“This is not a return to the days of the council being a social landlord providing mass housing. The company will operate commercially but be very focused on social value and social responsibility and won’t compete with Housing Associations.
“This is not about competing with other sectors but about filling gaps in the market which the private sector is not doing, and increasing the quality of the housing market.”
The company could also buy up and refurbish vacant property to support parts of the city where the housing market is struggling.
Over the last five years a number of local authorities including Thurrock, Gateshead and Brentwood have entered the housing market on a commercial basis, and research suggests over 50 councils in England are in the process of developing housing companies.