In this weeks Homes and Property, the Wednesday supplement to the daily Evening Standard (London UK) had an article on how one local council (think county government in the US) was looking to sell of some of its prime rental properties to so that the council could then fund the costs associated with maintaining the remaining rental portfolio. Put another way the units that are in a prime and expensive area were to be sold so that units that are in a less desirable area can be fixed up. At least that was the plan before the credit crunch.

Council houses with some of the smartest addresses in London — in Hampstead, Regent’s Park and Bloomsbury — are set to be rented out to private tenants for the first time.Camden council bosses are considering a plan to cream off the best-located 500 properties in its housing stock so they can be let at money-spinning commercial rates.

If an owner cannot sell it makes sense to rent the property. In this case the council is thinking of renting the units for market rents to people who are not needing government support. The added income from the market rents to working professionals will bring in more capital than leaving the units in the public rental pool.

Critics of the proposal — which could also be adopted by other London councils — say it would mean higher earners would have the pick of homes meant for families on the council’s waiting list. Many families stay on the list for months or years, they point out.But the council says it is legally obliged to bring all its properties up to new standards of repair set by the Government and, without extra funding, must look at imaginative ways to raise the money.

I think it is a great idea. The council recognizes there are limits to how much the taxpayers will pay for maintaining social housing. The people who are getting state support want a clean and functional home. They do not expect to live in the best locations or in a prime property. Maybe there will be fewer people waiting on a list if the premium properties are effectively removes from the social housing pool.
For the full article
Your views?

Tags: Camden, social housing