The city council aims to make more affordable homes available in the city by purchasing around 50 properties to let to families on its housing register.
It plans to spend around £8 million on a mix of privately owned properties within existing council sites or privately owned sites; and also on new-build houses being developed on private sites.
Some of the funding (£2.4m) will come from a pot of money retained from the sale of council properties under Right to Buy. However the council is only allowed to use this money for up to 30% of the total cost of creating new homes. The rest will come from the council’s capital programme (£1.6m) and from borrowing against income from council house rents (£4m).
The funding would cover the cost of any works required to bring purchased properties up to the council’s required standards for letting, and the cost of new builds on sites acquired. Income from rents on the purchased properties would cover the cost of repairs, maintenance and lettings, and financing the cost of borrowing.
Leicester City Mayor Peter Soulsby said: “There is a desperate need for more affordable housing in the city and we are constantly looking for new ways to provide it.
“Under this new proposal we will significantly increase our housing stock by buying existing or planned properties on private developments which will go to people waiting for a council house who are in the greatest need.”
Asst city mayor for housing Cllr Andy Connelly said: “Over the past seven years we have been able to create more than 300 new affordable homes by making land available at low cost to providers of social housing. And we have plans well under way to build our own houses, with the first phase of works to build 29 houses set to begin early next year.
“However, because of the Government’s Right to Buy scheme we have also been forced to sell thousands of council houses over the past 30 years, so initiatives like this are vital to create the affordable housing that’s desperately needed.”
The purchase of these properties would be in addition to the 370 affordable homes that are planned to be built by the council’s housing company, Housing Leicester Ltd.
This week the council will be submitting its planning applications for the first phase of building work worth £6 million. The applications are for a total of 21 houses and 8 bungalows spread across Ambassador Road, Selby Avenue, Rosshill Cresent, Brocklesby Way, Maplin Road and Felstead Road.
If approved work is likely to begin in spring 2019.
The council will be investing an additional £48m into phase two of its building works when it will build a further 320 homes. A small number of these properties will be sold to help fund the affordable housing.