London Boroughs Combine on Private Rental Housing

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London boroughs have decided to combine together to take a more collaborative approach to securing accommodations for the homeless.

Thirteen London boroughs have set up a not-for-profit company, Capital Letters, which is being supported through £38 million of grant funding from the Ministry of Housing, Communities and Local Government, with the aim of providing more housing options by lessening competition between councils.

The coming together of London boroughs is being chaired by the interim director of housing and regeneration at Tower Hamlets, Mark Baigent.

Mr Baigent explained why there was a need for the London boroughs to unite, saying: ‘Each borough has their own individual procurement team, they’re all ringing the same landlords and competing. The only winner in that is the private landlord, the families and the boroughs aren’t winning out of that process – they pay more money than they should be paying and they’re wasting their time. It’s about giving us the upper hand over landlords in the negotiating process.

A particular concern was over golden handshake’ incentive payments made to private landlords when tenants take on a new lease.

Mr Baigent said: ‘A particular London borough might say ‘we’re only prepared to pay £2,000 as an incentive payment’ and another borough might come into that area and say ‘we’ll pay £3,000.’ That’s the kind of thing that happens, it’s well documented.’

He continued: ‘So Capital Letters is committed to not outbidding other boroughs in terms of securing properties. By collaborating within the company, we should have a lot more influence over the marketplace, because we will be procuring the majority of temporary accommodation in London.’

The scheme aims to start procuring properties by June 2019 and over the next two years, ‘gateways’ will open up when other London boroughs will be invited to join.

Founding members of Capital Letters

Tower Hamlets LBC   

Haringey LBC  

Waltham Forest LBC  

Brent LBC  

Ealing LBC  

Bexley LBC  

Lewisham LBC   

Croydon LBC

Redbridge LBC  

Southwark LBC   

Barking & Dagenham LBC   

Westminster City Council   

Hammersmith & Fulham LBC

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