Hythe Gets 26 New Affordable Homes—But Council’s Housing Budget Runs Thin

Twenty-six new affordable, energy-efficient homes are set to transform Hythe’s Boundary Road (site below in orange, as the council advances its pledge to address housing needs in the district. Located on the former Smiths Medical site, the development will include 14 one-bedroom flats, six two-bedroom flats, three two-bedroom houses, and three three-bedroom houses. Of these, 20 flats are earmarked for affordable rent to tenants on the council’s housing list, while the six houses will be offered through shared ownership. Scheduled for completion in 2026, the project aims to bolster accessible housing provision while prioritising sustainability and community needs.

But before looking to the future, the site’s recent history is worth revisiting. Smiths Medical acquired the land in March 2005 for £1.25 million, before selling it in August 2018 to Rewd Limited for £2.1 million. In March2021, Rewd secured planning permission (agenda item 70, reference Y19/0071/FH) to redevelop the land. Despite this approval, the company was unable to fund construction and subsequently sold the site for £8.75 million in December 2022, according to Land Registry data.

The site will now be developed by Roddy New Homes Ltd, a company controlled by two entities: Salboy Partnerships Limited and Redrock Hudson Ltd. Redrock is ultimately owned by brothers John and Paul Roddy, while Salboy Partnerships’ parent company is Salboy Ltd, owned by Mr Fred Done (pictured)—best known as the chairman of the gambling outfit – Betfred, whose online gambling operation, Betfred.com, is registered as Petfre (Gibraltar) Limited. Both companies behind the development are financially solvent.

Attention also turns to the Council’s announcement, made on 19 March, confirming the acquisition of all new 26 homes affordable homes. This move follows an earlier acquisition of 44 affordable homes from Taylor Wimpey at the Risborough Barracks site in Cheriton. While these purchases align with the council’s objective of increasing affordable housing, they are being made against a worrying financial backdrop.

The Council’s Housing Revenue Account (HRA) reserves have fallen from around £12m in 2021/22 to just £3.4 million in 2023/24. This 70% decline suggests that the HRA is under mounting pressure—struggling to offset rising costs and unable to generate sufficient surpluses or capital receipts to replenish its reserves. With the significant outlays on 70 new affordable homes in 2024/25, reserves will likely be stretched even thinner.

That concern is reinforced by the Q2 HRA monitoring report for 2024/25, which reveals a £343,000 deficit variance compared to the latest approved budget. As a result, the council is now drawing £1.308 million from its already depleted HRA reserves to balance the books—further evidence of a system buckling under strain.

The underlying challenges are structural. Interest payments on council borrowing are rising—a direct effect of the Bank of England’s recent rate hikes. Meanwhile, major capital programmes have either stalled or been shelved, curtailing the council’s ability to develop new homes and undermining the long-term health of its rental income base. Less development means fewer rent-generating assets and diminished efficiencies across the board.

A £706,000 deficit in the HRA in the 2023/24 is more than a red flag—it’s an inflection point.  That said, the HRA borrowed £4m from the PWLB in Dec 2024.

A financial framework that once offered stability is now beginning to fracture. Without reforms to rent policies, improved operational efficiency, or significant injections of external funding, the HRA risks slipping into a spiral of recurring deficits with dangerously low reserves to cushion future shocks.

In short, while it is laudable that the council continues to prioritise affordable housing for local residents, it must be acknowledged that Folkestone & Hythe’s HRA budget is no longer just under pressure—it is becoming critically overstretched.

The Shepway Vox Team

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