Manchester’s affordable housing options: Tackling homelessness and temporary accommodation

Manchester continues to grapple with significant challenges in providing affordable housing and reducing homelessness, despite notable progress in recent years.

Local Partnerships has been working closely with Manchester City Council to address the city’s growing need for temporary accommodation and affordable housing. Through a combination of innovative solutions, including invest-to-save models, soft market testing with potential partners, and the development of a data-driven temporary accommodation model, Local Partnerships has helped the council make informed decisions and reduce costs. This collaborative approach is playing a key role in trying to alleviating homelessness and bridging the city’s affordable housing gap.

The challenge:

Despite huge progress in addressing rough sleeping, Manchester continues to face significant challenges in meeting housing need. When we were commissioned to help, the number of households in temporary accommodation per 1,000 households was three times higher than that of English single tier authorities. The number of households residing in temporary accommodation had increased significantly over the past six years, by over 600%.

The number of households in Manchester on the housing waiting list (14,497) is more than double the local authority average.

This reflects Manchester’s booming housing market along with a significant slowdown in tenants moving out of social housing. 

The council’s housing service actively works with local providers and central government to source more suitable and affordable accommodation, particularly in relation to ending the use of bed and breakfast for families with children. 

The council’s budget strategy for homelessness has been to contain the cost of rising need for temporary accommodation within available resources whilst also prioritising resources towards service developments that will achieve the service’s priority to prevent and reduce the incidence of homelessness. This has been supported by significant additional investment from the council protecting front line services, maximising draw down of Housing Benefit income that the council can claim and seeking opportunities for accessing external funding.

Solutions:

Our work with Manchester City council related to increasing the supply and access to affordable housing in the city, with a view to reducing the council’s temporary accommodation requirements.

First, Local Partnerships worked alongside the council on three strands of work:

• Identifying potential invest to save models.
• Identifying and appraising longer term models of potential intervention.
• Providing an independent and respected local government sector voice, which highlighted good practice (where it may be applicable to Manchester) and positions the council to access future funding opportunities.

Secondly, we worked with the council to develop a temporary accommodation model, which gave the council a data-led understanding of the city’s requirements. against which to assess the impact and cost of potential interventions. This model, adapted to local needs, could be applied elsewhere.

We then worked on a third phase of work, as part of the DLUHC funded Hands On Sourcing Support project, where we conducted soft market testing with a range of potential partners, such as social impact funds, pension funds and developers to identify their appetite for working with the council to boost affordable housing in the city.

Lessons Learned:

• The importance of having clear objectives and criteria for appraising potential interventions in the housing market, rather than responding in an ad hoc way.

• The importance of a clear evidence based approach to inform decisions on future interventions, and their implications.

• The importance of soft market testing with a range of potential partners and investors, to understand the potential for new investment in an area, and the conditions under which this would work.

Impact:

Manchester has made huge progress in addressing homelessness in the city in recent years, particularly in relation to families living in costly temporary accommodation. In 2023-24, the annual net cost of temporary accommodation dropped by 5%, saving the council around £1m per annum. This has been the result of a concerted, council wide push to address these issues, with councillors, officers, and external stakeholders working together on areas including policy, prevention work, and assessing options for investment.

The impact of our work, as part of this overall approach, included:

• An options appraisal of the opportunities to address the demands on temporary accommodation in the city.

• The development and piloting, with support from the LGA, of a temporary accommodation model, which enabled Manchester City Council to make informed assessments of the best interventions for the future, over the long term.

• Up to date market intelligence from potential partners and the opportunities for levering in external support and investment to help address the city’s affordable housing gap.

Watch the Temporary Accommodation Model Webinar

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