Islington Town Hall is seeking to remove the cap on how much it can spend on buying property for council homes.
The plans would see an end to the £6m annual ceiling for expenditure, as well as allowing the council to look outside the borough – though within Greater London – to buy homes for its homeless residents.
The move has been prompted by the government’s decision to lift the cap on borrowing through the council’s housing revenue account (HRA) towards the end of 2018.
Cllr Diarmaid Ward (Lab, Holloway), executive member for housing and development, said: “Whilst we would seek to purchase as many homes within Islington, agreeing the expansion of the geographical area properties may be purchased within will combine to maximise the number of purchases made and the increase the resultant financial and social benefits of the programme.
“The increase in council owned rented homes will help meet housing need in the borough and save money on temporary accommodation for the General Fund.
“It will also reduce the number of properties with unaffordable rents and generate additional income to the HRA to cover delivery costs.”
The Town Hall is currently funding a property acquisition scheme through right-to-buy receipts and borrowing on its general fund, which at March of this year had secured 46 new council homes, all within the borough.
However, since the lifting of the HRA borrowing cap by central government, the council argues that shifting the scheme back to its housing fund has a “number of benefits”, including greater flexibility in terms of debt management and choice of property purchase.
However, spend on the acquisition programme within the HRA is currently set at £6m, the ceiling top councillors are now preparing to lift, to be replaced with “a requirement for the programme to continue on an ongoing basis”, or in other words, subject to budgeting year by year.