Council to borrow £45m to help ease homelessness

Leicester City Council declared a housing crisis in 2022

Councillors have agreed plans to borrow £45m to buy property in an attempt to ease a growing housing crisis in Leicester.

A total of 225 properties will be purchased, to use as temporary accommodation, and a further 125 leased to ease demand for social housing and also move families out of unsuitable bed and breakfast and hotel accommodation.

Demand for housing is increasing as more people find themselves without permanent accommodation, and the government speeds up asylum decisions for those in temporary housing locally.

Without action, Leicester City Council claims it would face extra costs of £23m in the coming financial year.

Some frustration

The idea was due to be put to councillors in January, but it was withdrawn after concerns were raised over its legality.

Some councillors were worried that using general funds to buy the property - rather than the dedicated Housing Revenue Account - could be problematic, but city barrister Kamal Adatia described the legal risk of this as "low".

In a council debate, there were calls for more house building generally, and some frustration about how quickly the Ashton Green development, on the northern edge of Leicester, is being built.

But in a vote, the plan was supported by all parties except the Liberal Democrats, who abstained.

Leicester joins city authorities including Birmingham, Coventry and Plymouth, which have also agreed to spend more on purchasing more properties in the past two years.