Dudley Council looks set to pay out £2.5m on ten new homes in Coseley after agreeing a deal with a major house builder.
The authority’s cabinet member for housing and homelessness, Cllr Ian Bevan, has approved the plan to buy the houses on a site known as Coseley New Village on Sedgley Road West.
The new-build homes are being constructed by Persimmon Homes Ltd and Dudley is set to purchase six three-bedroom houses and four two-bedroom houses.
Council officers negotiated a discount of 9.8% which means the larger homes will cost £270,500 each while the smaller houses will be bought for £230,000 per unit.
Changes in rules for funds raised from the right to buy scheme, which allows most council tenants to buy their home at a discounted price, means councils are now allowed to spend all the revenue they make from selling homes.
Previously a portion of right to buy cash was taken by central government but councils can keep it all to purchase new housing stock.
Dudley aims to spend £10m on new homes in the current financial year. The government provides cash for councils to build homes from a £9.2bn funding pot called the Homes England grant however
Dudley has not been able access the grant for two years. Another barrier to the council building its own houses is that it does not own enough suitable land.
A report on the decision to buy the ten homes in Coseley said: “Purchase sites are primarily determined by the willingness of developers to sell to the council within the confines of the borough, and the availability of newly built homes in the borough for sale of which there is a scarcity at present.
“The properties at Coseley New Village are located in a densely populated area in Coseley and will be readily let to those in need on the waiting list.
“Purchasing property on the open market from a large national house builder with no development/delivery risk to the council makes for a sound business case.”
The decision to buy Coseley New Village homes is set be confirmed on August 18.
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