Pioneering plan to raise £20million for new homes in Islington hits the skids

Voters can have their say on who sits on Islington Council

Voters can have their say on who sits on Islington Council - Credit: Archant

A trail-blazing plan to raise £20million for new homes by selling lease extensions to homeowners has been scuppered.

The scheme, thought to be the first of its kind country, involved Islington Council offering leaseholders a one off chance to extend their lease by 99 years at a knock down price.

The man behind the idea, Brian Potter, estimated £22million could be raised if all 11,000 of Islington’s leaseholders took part.

The plan got as far as the council chamber and the town hall chiefs initially seemed keen, but now Cllr James Murray, Islington Council’s executive member for housing and development, has dismissed the idea.

Responding to a question about the scheme at a full council meeting, he said: “I was interested by this proposal.”

He added: “If we need money for our new build programme, we can sell assets or borrow money. The cost to the council of borrowing money is relatively cheap. If we were to give leaseholders a big enough discount to make it unequivocally worth their while renewing early, then this would likely cost more than the cost of our borrowing the money.

“On this basis, the proposal is not as attractive as it first seems, which is a shame.”

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Dr Potter said: “I don’t think they should dismiss this idea, because it’s a away they can get money now, when they need it and there is now interest or anything to pay back.

“It’s money coming in to the borough. They say they have no alternative but to make these cuts – but here is an alternative. What would you rather do – this or keep making cuts?”