A deal to transfer 499 council houses and flats in Brighton and Hove to a not-for-profit company has been completed.
Brighton and Hove City Council said that the deal with Brighton and Hove Seaside Community Homes was worth £28.5 million.
The money will be spent refurbishing thousands of council homes which need modernising while allowing the council to remain the ultimate landlord.
This is because the homes have been transferred on a 40-year lease.
The council said that the agreement meant that it would still nominate tenants for the 499 properties.
This would enable it to meet its legal requirement to house the most vulnerable and needy while bringing its entire housing stock up to 21st century standards.
The council worked with tenant representatives to set up Seaside Community Homes – and four of them sit on Seaside’s 12-strong board.
The board also includes four councillors and four independent members and commands broad cross-party support.
A few people have expressed concerns about the deal which involves Seaside borrowing the £28.5 million from Santander bank and using rents to repay the money.
Rents are expected to be higher than they are for the 12,000 homes retained by the council.
This is made possible by the system of housing benefits and allowances as most if not all of Seaside’s tenants are likely to be unemployed.
Critics of the deal fear that problems could arise if the coalition government makes changes to the system.
In the meantime, Seaside chairman John Regan said: “This is a fantastic moment and is testament to everyone involved in this new company.
“We have worked hard to reach this point and we’re now able to improve the lives of many of the city’s most vulnerable households – single people and families.
“With our partner Santander we will now invest millions into improving the city’s housing and providing much-needed homes.”
Council leader Bill Randall said: “This is a groundbreaking deal that will mean those in desperate housing need, such as the disabled or those fleeing domestic violence, will be housed and council tenants will see their homes improved.”
Councillor Randall, who also sits on Seaside’s board, added: “Tenants want to keep the council as their landlord but see improvements to their homes and this agreement will deliver both of those aspirations.
“Our priority is to improve our homes and ensure all council tenants have homes that meet modern standards.”
The tenants’ desire to keep the council as their landlord was expressed in a ballot four years ago.
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