More homeless and fewer landlords send housing costs over budget

Temporary housing is costing much more than expected this year as more people turn for help to Brighton and Hove City Council.

And a drop in the number of private landlords renting out property has left the council with fewer but more expensive options.

The council has estimated that it spent £8.9 million on temporary housing from the start of April to the end of October – 40 per cent over the £6.3 million budget for the period.

Even by the end of May the service was 20 per cent over budget as a growing number of people became homeless.

A report to the council’s cabinet said: “In England and Wales, there are now more households in temporary accommodation (112,660) than ever before.

“Brighton and Hove has done well to keep numbers stable but since December 2023 there has been a steady increase.

“During 2023-24, this increase in Brighton and Hove was 3 per cent, compared with 10 per cent nationally.

“As well as demand pressures there are also price pressures, with the average price of nightly accommodation increasing by 12 per cent since 2023-24.

“As a result of these pressures, the temporary accommodation service is forecast to overspend by £2.548 million including £1.146 million of savings at risk of not being met.”

A key aspect of the overspend is the “spot purchased” or emergency nightly booked housing which is forecast to overspend by £1.67 million.

By the middle of last month, the latest budget and spending report to the cabinet said that 352 households were housed in nightly booked housing.

This is “192 higher than budgets allow” and the forecast assumes that this will have reduced to 320 by the end of March when the financial year ends.

The report said: “The service is aiming to maximise the use of void (empty) council-owned stock where appropriate.

“Additionally, the price of nightly booked accommodation has seen a steep increase of around 12 per cent compared with prices in 2023-24.

“The underlying trend is that the number of households using nightly booked accommodation is increasing due to changes to the private rented sector, with many landlords exiting the market.

“This has a double impact on homelessness and the ‘end of private rented’ is the main reason for homelessness.

“But in the last two quarters, this has increased from 34 per cent of all new cases to 61 per cent.”

The council has an overall budget of about £1.1 billion a year although significant amounts are ringfenced, with the government setting out how the money has to be spent.

A key focus for the cabinet is the council’s “general fund” which has a revenue budget for day-to-day spending of about £260 million.

The report to the cabinet said that this was at risk of being overspent by about £6.8 million by the end of the financial year – or about 2.6 per cent of the total.

Demand-led services such as community care and home to school transport have added to the risk of the council spending more than budgeted.

Community care is already estimated to be more than £2 million over budget and the “cost pressure” for home to school transport is almost £700,000.

To add to the challenges, the council has also received less income than forecast in some areas such as parking services which is on course to make about £350,000 less than budgeted.

The cost of making a planning application went up this year but the council now expects to make about £300,000 less from planning fees than budgeted.

Pay increases have added to the council’s costs but grants from the government have not always gone up enough to fund these extra commitments, adding to the pressures on the budget.

The council had planned to making savings of £23.6 million in the current financial year but the report to the cabinet said that almost £4.5 million was unlikely to be achieved.

The cabinet is due to meet at Hove Town Hall at 5pm tomorrow (Thursday 5 December) and to discuss the council’s finances. The meeting is scheduled to be webcast on the council’s website.