Redbridge pulls out of housing partnership

Redbridge Council has pulled out of a London-wide partnership that provides properties for people at risk of homelessness.

The decision comes as the council faces sustained pressure to help families in housing need, with more than 2,900 currently in temporary accommodation.

Capital Letters, a company wholly owned by participating London boroughs, was supposed to provide Redbridge with 200 properties a year from 2020.

However, in the year up to March 2023, it provided Redbridge with only 21 homes.

Redbridge Council said Capital Letters has “consistently and significantly” failed to deliver the agreed number of homes.

The council added: “Whilst the market for affordable rented property has contracted significantly in London over the last two years, it is notable that even prior to this period Capital Letters Limited were not delivering against their Service Level Agreement.”

In contrast, the council said its in-house team achieved 185 “moves” in 2022/23 and 178 the year before.

Capital Letters, a not-for-profit company, was set up in 2019 with millions in government support to reduce the cost of temporary accommodation and finding residents permanent rented housing.

Redbridge joined Capital Letters as an “A” member, meaning it had to procure at least 50 per cent of its privately rented housing through the company.

A spokesperson for the company said research it commissioned into the housing market shows it has become “extreme,” with a 41 per cent reduction in privately rented homes listed as available, a 20 per cent increase in rents and an 83 per cent decrease in homes advertised as at Local Housing Allowance rates.

They added: “In the light of this extreme lack of supply the Capital Letters Board, along with members, took the prudent business decision to consolidate Capital Letters membership to a smaller number of boroughs, leaving the decision to members (as co-owners with no contractual obligation) whether to continue working with Capital Letters or to exit in April 2023 – Redbridge chose to exit.

“Capital Letters is now a landlord, and we are working with ethical investment partners and portfolio holders increasing the number of properties that we are offering to our ten member boroughs.

“We hope to offer good quality, affordable homes to Redbridge Council in the future.”

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Josh Mellor

Local Democracy Reporter