Background to stock transfer
For several years now significant investment in new social housing has been impossible given high levels of debt, incurred by the housing service in the past. Currently 40 pence in every £1 of tenants’ rent goes towards repaying this debt of around £48million. With the number of houses decreasing, through right to buy for example, the rent of fewer and fewer homes is available to support the service.
For this reason the Council completed an options appraisal study in 2003 to decide whether it could continue to maintain and fund appropriate investment in its stock of approximately 6000 houses. The study focused on whether current rent levels would be sufficient to cover:
a) the housing debt built up over a number of years
b) ongoing repairs and maintenance
c) the need to meet the Scottish Housing Quality Standard by April 2015.
The appraisal showed that the Council would require an estimated £169 million to upgrade and maintain the housing stock over the next 30 years. After concluding that it could not deliver the investment and quality homes required without significant rent rises, the Council considered all options before deciding that, in principle, whole stock transfer was the best way forward. After the completion of a feasibility study the Council was formally accepted onto the Scottish Executive’s Community Ownership Programme in October 2004.