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London borough invests £10 million in property fund to help homeless families

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London borough invests £10 million in property fund to help homeless families

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Published by Jon Land for 24dash.com in Housing and also in Local Government

London borough invests 10 million in property fund to help homeless families London borough invests 10 million in property fund to help homeless families

A London borough is to invest £10 million in a property fund in an attempt to ease the borough's housing crisis and provide suitable accommodation for its homeless families.

Croydon Council made national headlines back in 2011 when it revealed that is was seeking accommodation in other parts of the country - including North Yorkshire, Kent and Sussex - because there wasn't enough suitable homes in the borough.

Now, however, it is teaming up with investment fund manager Resonance and homelessness charity Broadway to invest £10m in the charity's Real Lettings service with the aim of securing nearly 100 one and two-bedroom homes in London over the next few months.

The investment is part of the council’s 2014/15 capital budget with the fund expected to produce a return for investors that comes from an increase in property values and rental income.

Croydon is the first local authority to invest in the fund, which has a growing pool of investors, mostly housing associations and charitable foundations.

Real Lettings offers affordable accommodation in the private rented sector for formerly homeless people.

The council will nominate the tenancies while Broadway will place households in the homes purchased by the fund. If the scheme is successful, there are plans for another £10m investment later on.

Councillor Dudley Mead, cabinet member for housing, said: “With house prices going up beyond what is affordable to the council, we have to look at alternative and innovative ways of buying property to increase the supply of housing available to the council.

“This will ease the pressure on the council in managing homelessness and means we can place families in good quality accommodation as opposed to costly bed and breakfasts.”

Susan Fallis, assistant director of services at Broadway Homelessness and Support, said: “By investing in the Real Lettings Property Fund, Croydon Council is tackling homelessness in the borough head on. Their commitment is helping to ensure homeless families in the area get access to high quality but affordable private rental accommodation that may otherwise have been out of reach.”

Daniel Brewer, managing director of Resonance, said: "Croydon have shown real leadership by using their balance sheet, rather than just relying on increasingly tight revenue budgets, to provide for some of their more vulnerable families. We're hoping a number of other London boroughs will follow suit."

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