Private Sector Leading a Win-Win for All

by Scott Douglas

Tuesday, December 18th, 2007

Orchard & Shipman plc, the company behind an innovative concept to help local authorities tackle the problem of people in housing need, has secured new contracts with a further three councils in Scotland.

Midlothian, East Lothian and Scottish Borders Councils have all signed agreements for Orchard & Shipman to find and manage private rented homes under a scheme known as Private Sector Leasing (PSL).

PSL allows Councils to provide quality accommodation to people who may have lost their homes through, for example, relationship breakdown or unemployment, instead of looking at temporary housing options such as expensive B&B’s.

PSL is also particularly appealing to private landlords as it offers the security of guaranteed long-term income, rents paid in advance with no voids and no agent’s fees – and the return of the property in good condition.

The introduction of PSL schemes in Midlothian, East Lothian and Scottish Borders is   likely to give the local property markets in each area a boost as investors look to purchase buy-to-let properties to sign up with Orchard & Shipman.

The first PSL contract in Scotland was signed between Orchard & Shipman and The City of Edinburgh Council (CEC) in September 2005, with the company required to find 1500 properties by 2010.  Such has been the success of the Edinburgh scheme that Orchard & Shipman has already secured its 1,000th property – two years ahead of target – and the scheme is already the largest of its kind in the UK.

A survey of the Edinburgh scheme revealed that a phenomenal 96% of tenants and 100% of landlords describe the service as ’excellent’ or ‘good’ and with 6,000 landlords and investors registering an interest the continuing success of the scheme seems assured.

Midlothian Council were first to decide to tender for a PSL contract with Scottish Borders and East Lothian Councils later agreeing to negotiate a combined tender – providing a good example of local authorities saving taxpayers money by working jointly towards a shared objective.

Angela McLachlan, Head of Social Housing Scotland for Orchard & Shipman, said securing new contracts with the three councils was a ringing endorsement of the success of PSL.

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She said: “The shortage of housing is a problem in most areas across the UK and this problem will not disappear overnight. Edinburgh and now Midlothian, East Lothian and the Scottish Borders Councils are looking at different ways to address this important social issue to help them achieve Scottish Parliament targets to give every homeless person the right to a home by 2012.                                                         

“We believe PSL has an important part to play to help Councils achieve this objective. PSL works because it benefits the council who faces huge demand to provide housing, the families desperate for quality accommodation in areas that they want to live in, and private landlords who see the benefits of long-term income for their investments.”

The recent Bank of Scotland’s Rural Housing Review revealed that East Lothian and Scottish Borders were the top two least affordable areas for property in Scotland – with the Scottish Borders the area with lowest number of first time buyers.  The percentage of private rented property in the three areas varies between just five-10 per cent, highlighting the difficult local property issues.

Orchard & Shipman is now keen to hear from private landlords and investors in each of the three new local authority areas. A series of landlord information evenings are being planned soon (see http://www.orchard-shipman.co.uk for details or e mail [email protected]) to provide more information on PSL.

The contracts with the three councils will run for the next five years and will see Orchard & Shipman increase its workforce within Scotland from 45 to at least 70. The company will also be opening a new office in Galashiels.

Midlothian Council Leader Councillor Derek Milligan said: “We welcome this new venture in providing accommodation to meet the increasing demands on housing in the area. The Council is very aware of the increase in the number of people seeking housing, and the waiting times involved, and we are confident that the PSL scheme will have a major impact in alleviating these issues. We look forward to a successful working relationship with Orchard & Shipman to achieve this.”

Ewan Ritchie, Development Officer with East Lothian Council Housing Strategy & Development, said: “This exciting new scheme will increase the range of housing options available to homeless people in East Lothian. We are looking forward to working with private landlords and Orchard & Shipman to develop this project over the coming years.”

Cathie Fancy, Group Manager Housing Strategy and Services of Scottish Borders Council, said: “PSL shows the public and private sector working well in partnership to provide quality accommodation to people in housing need. There are well documented difficulties with the property market in the Borders, which present acute problems for those in housing need and the Council who have a statutory duty to find homes for these people. These need to be addressed in different and imaginative ways.  PSL, although perhaps unknown to many just now, is one such concept that we believe can help tackle this issue.”

Angela added: “We will be looking to procure properties of all sizes – from one bed flats to large family homes – across all areas of the region.  Our message is: if you have a property in each area and are considering letting it out, contact us.”

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