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To enter into a Nominations Agreement with the
charity DHI (Developing Health and Independence), so that the
council can nominate households who are homeless or at risk of
homelessness into properties that are managed by DHI in the private
rented sector.
These properties will be inspected by the council’s Private
Sector Housing team, to ensure they are free from category 1 health
and safety hazards. Tenancies will be available for prospective
tenants on a long term basis, with rents being set at no higher
than Local Housing Allowance levels.

Reasons for the decision

DHI have entered into an arrangement with
Resonance to lease a number of properties across Gloucestershire
for up to 5 years, with the possibility of a further 5 year
extension thereafter.
Resonance is a social impact investor, which is aiming to purchase
around 90 to 100 properties from the open market across
Gloucestershire via a National Homelessness Property Fund. This
investment in Gloucestershire has come about as a result of the
Gloucestershire Pension Fund having invested around £30m into
this National Homelessness Property Fund.

It is anticipated that up to around 25 homes will be purchased in
Cheltenham as part of this investment. These homes will be a mix of
bedroom sizes, with the majority in Cheltenham anticipated to be
larger family homes (i.e. 3 and 4 bedroom properties). It is
further anticipated that these homes will be purchased during
2025/26 and 2026/27.
In return for the council being able to provide nominees to these
properties, the council will be required to pay a placement fee of
£3,500 per property, inclusive of VAT. This fee will also
help to ensure that rents can be maintained at relatively
affordable levels in that they will not exceed the Local Housing
Allowance. This placement fee will be a one-off payment per
property and will last for the duration of the 5 year period. This
means that if any of these properties become available for
reletting during this time, then no further placement fees will be
required. If at the end of the first 5 years the lease agreement
between DHI and Resonance is extended for a further 5 years, then a
second placement fee will become payment for any properties that
become available for reletting during years 6 to 10 (i.e. between
2030/31 and 2035/36).
In addition to the placement fee, the council may also make a
payment to DHI equivalent to one month’s rent by way of a
deposit. The tenant will receive this deposit at the end of their
tenancy, subject to their property being undamaged, etc. This will
enable the tenants to find suitable alternative accommodation more
easily in the future. It may also help incentivise the take-up of
these properties as an alternative to waiting for an offer of
social housing. This in turn will enable the council to end any
potential homelessness duties.
Funding for this initiative will come from MHCLG’s
Homelessness Prevention Grant, and sufficient provision has been
set aside to enable this initiative to be fully financed via our
Homelessness Prevention Grant allocation for 2025/26 and 2026/27,
as all the homes are anticipated to be made available during these
two financial years.
If at the end of the initial 5 year period DHI wish to extend the
initiative for a further 5 years,
these costs could be financed from future (in-year) Homelessness
Prevention Grant funding, subject to available funding. In the
event that the council does not wish to continue with this
nominations agreement at the end of the initial 5 year period, then
it will have the option to terminate the arrangement.

Alternative options considered

Not to enter into a Nominations Agreement with
DHI. This has been rejected on the basis that demand for emergency
and other forms of temporary accommodation is continuing to
increase Cheltenham, with pressure increasing on households
requiring larger accommodation. This initiative with DHI will help
to alleviate some of these pressures.