Almos invited to join in affordable home-building

10 Nov 05
Council-owned housing companies are being encouraged to join the government's drive to build more affordable homes.

11 November 2005

Council-owned housing companies are being encouraged to join the government's drive to build more affordable homes.

In the clearest sign yet that arm's-length management organisations have a long-term future, they have been asked by ministers whether they have land available for new housing and how they might finance construction.

Although Almos can bid for grants from the Housing Corporation alongside developers and registered social landlords, few have shown much interest because of their limited power to raise additional private finance.

A letter inviting them to state whether they are interested in building properties was sent out by the Office of the Deputy Prime Minister to coincide with a recent meeting between housing minister Yvette Cooper and the National Federation of Almos.

Gwyneth Taylor, policy officer at the NFA, said ministers appeared to be investigating the potential for more house-building outside identified growth areas in the English Southeast before issuing their response to the Barker review of housing supply in the next few weeks.

Although it was doubtful whether Almos would enter into development on the same scale as RSLs, they were keen to replace homes bought by tenants through right to buy as well as other small-scale developments, said Taylor.

Derby Homes has already linked up with a developer and submitted a bid to build 110 homes on two sites in the city. 'We would like to enjoy similar freedoms to housing associations and build up our asset base,' said Shaun Bennett, director of investment and regeneration.

Another Almo looking to build properties is Hounslow Homes in west London, probably using prudential borrowing.

But all are likely to point out that they cannot commit themselves to major schemes until they discover the results of the ODPM's review of Almos, due before the end of the year.

Almos have, meanwhile, been assured by the Inland Revenue that they are exempt from paying corporation tax on surpluses on contracts held with their parent council. There is still doubt over whether the exemptions apply to trade with other organisations.

PFnov2005

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