Reduce text sizeIncrease text sizeDefault coloursImproved contrastHigh contrastThe Langley estate in Rochdale was a large Manchester City Council overspill estate, which suffered from a poor reputation, causing it to be unpopular. As a result, it become hard to let properties and particularly the cottage flats on the estate.
The properties suffered from chronic disrepair including condensation and infestation of insects that resulted in EH officers being frequent visitors. The end result was to board them up for many years whilst a solution was found. As they are cottage flats, they were scattered across numerous corner plots on the estate, rather than being concentrated in one place.
The estate was subjected to a stock transfer in 2002 to Bowlee Park HA (now Riverside Pennine).Following stock transfer, much needed investment was put into making the existing homes decent, environmental and boundary works were undertaken, as well as a plan to tackle the mono tenure nature of the estate. Due to the level of disrepair and unpopularity of the flats, it was uneconomical for Riverside to renovate them.
However, it was recognised that these empty properties provided an opportunity to help diversify the estate post transfer, and working in partnership with their partner developer, ID4Living, Riverside Pennine looked to use the properties to create low cost home ownership.
The estate was also chosen as a first wave intervention area for the Partners in Action HMR programme for many reasons, not least because the long-term vision was in place and programmes underway. Whilst the cottage flats were not part of the HMR programme, because there were so many of them and they were scattered across the estate it was important that they were dealt with. As change was taking place on the estate, so these properties were becoming more prominent and residents began to become concerned that they were causing problems for the rapidly improving and increasingly popular estate.
ID4Living had intended to renovate the properties and convert some to houses for sale. Some were done, but then the financial markets crashed, meaning that although people wanted to buy, they were unable to get mortgages, thereby putting this part of the regeneration plan in jeopardy.
RHI at the same time were developing a proposal for RMBC to develop a proactive approach to tackling empty homes, in part because we predicted the situation of long term empty homes would probably get worse due to the economical and financial problems.
In developing a proactive empty property toolkit, we analysed council tax records to gain a greater understanding of where properties were empty, why they were empty (i.e. looking at exemptions etc) and the ownership pattern as a way to familiarise ourselves with the situation locally. In doing this we noticed a pattern of empty properties being owned by ID4Living on the estate. At this stage we did not have knowledge regarding the contract that Riverside and ID4Living had in place.
This led us to contacting ID4Living to discuss the situation, and then to use our skills in developing a solution to
It was important to find a solution that would not compromise the long-term objective of tenure diversification of the estate as well, so the option for Riverside or RMBC to buy them from ID4Living was not an option.
After discussing the situation with the owners, RMBC and Riverside Pennine and understanding their issues and strategic objectives, and looking at the needs of the community, we concluded that the best solution was to introduce Riverside to Temporary Social Housing (TSH) grant from the Housing Corporation.
TSH works very simply and the principles can be applied to situations where any public funding might be considered to be used to tackle empty homes. It works thus:
Public subsidy is linked with the Registered Providers (RP) contribution. The RP will have borrowed the funding, so this needs repaying. The property (ies) are leased from the owner to the RP for a period of time (up to 29 years) and minimum lease period is usually determined on the length of time needed to repay the debt on the property.
The properties are in turn sub let on Assured Shorthold Tenancies to people off the waiting list. The owners benefit from a significant capital injection, effectively getting their property refurbished, in return for received a small rent (or no rent), with the owners benefit is the increase in asset value.
During the time of the tenancy the RP will be responsible for most of the maintenance on the property, and the owner can sell the property during the lifetime of the tenancy so long as either:
In essence the project was simple, in that the problem was one of market forces, the owners could not justify further expenditure on the properties and they would not get a return. The RP did not want to re-purchase them and the desire to use these properties to aid diversification is overwhelming.
At the original meeting with ID4Living and Riverside, after having the concept explained to them of TSH, asked “ whats the catch “ and I explained there isn’t one, the deal normally falls down if the owner is greedy, ID4Living were not, so we had a scheme.
RHI took the lead on co–ordinating and brokering the deal in all aspects including
It was this role that was the catalyst to making the project work.
So we originally tackled 26 long-term empty flats, located on 13 sites across the estate, which had been empty for a combined total of over 180 years, and they were let via Riversides normal letting process. So impressed with this ID4Living and Riverside decided to tackle a second phase of empty flats except this time to convert 22 flats into much needed 11, 4 bed, 8 person houses.
Who was involved, what were the partnerships that helped this project grow?
RHI is already a company that is set up and funded by all the joint commissioned providers in Rochdale and RMBC. This history of working together enabled us to be able to work effectively with Riverside Pennine from the start.
During the development of the scheme we were able to strengthen the relationship between RMBC, Riverside Pennine and RHI.
Costs and funding
Both schemes were supported by the Housing Corporation via TSH funding, but what made them unique is that Riverside needed to find funding £452,626, however due to internal company rules and a scarceness of loan availability, it was decided that it was not possible or desirable to borrow against properties not in their ownership.
To overcome this RHI introduced the idea of RMBC using its prudential borrowing powers to create a loan to Riverside. This was achieved easily, with the main selling factor to the Council being that the debt could be transferred to ID4Living in the event of Riverside defaulting and that it was placed as a charge on the properties. So there is no risk to RMBC in the loan not being repaid.
From Riversides perspective, it meant they were offered a loan for £452,626 at a competitive interest rate.
Phase 1
| Works costs | £832,000 | |
| TSH Grant | £538,200 | £20,700 pu |
| Total scheme costs | £990,826 | £38,109 pu |
| Loan to Riverside | £452,626 | |
| Tenants rent | £75 pw | |
| Rent to owner | £15 pw | |
| Total scheme costs | £1,098,692 | £96,244 pu |
| TSH grant | £542,051 | £49,277 pu |
| Loan £0 | ||
| Owners contribution | £557,051 Tenants rent | £122 pwRent to owner |
| £65 pw |
The impact of the scheme has been very simple and effective:
The keys lessons to be learned from the scheme are:
Darryl Lawrence
Director
Rochdale Housing Initiative
St Chads House
32 Church Stile
Rochdale
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