Folkestone & Hythe DC Temporary Accommodation Costs Forecast to Rise £273,500 (≈30%) to £1.2m in 2025/26

Folkestone & Hythe District Council warns that the cost of housing homeless households in temporary accommodation (TA) is spiralling. In 2024/25 the council’s own finance data show it spent roughly £926,500 on TA provision. (A recent FOI response by a local outlet gave a similar figure, around £922,500.) Pressures are mounting: the October 2025 Cabinet report projects the TA subsidy shortfall to reach about £1.2 million in 2025/26. This marks a sharp jump from last year, reflecting a national trend of soaring TA bills. (Nationwide, councils spent about £2.8 billion on TA in 2024/25 – a 25% rise – with more than 100,000 households in TA.)

At Folkestone & Hythe the homeless caseload has doubled in a year (from ~55 to ~115 households in TA). Supply has tightened while rents have climbed faster than wages, leaving many private tenants vulnerable. The council notes that no‑fault Section 21 evictions, domestic abuse, family breakdown, leaving care or the forces, and cost-of-living stress are the main reasons households present as homeless. These are familiar national drivers: recent reports show Section 21 evictions jumped ~20% in 2024, and private sector repossessions doubled after the eviction ban ended. All of these factors – combined with a chronic housing shortage and frozen housing benefits – are pushing more families into emergency housing.

Council’s Proposal To Ease The Burden

The council’s housing team is proposing a three‑pronged strategy to control rising TA costs:

• Use more council‑owned homes as TA. Folkestone & Hythe already repurposes some of its own Housing Revenue Account (HRA) stock: 15 HRA flats are in TA use now, and the plan is to increase this to 35 (adding 20 units) by 2027. Using council homes is far cheaper to the public purse because 100% of the rent can be claimed from housing benefit (unlike private nightly lets, which are capped at 90% of the old Local Housing Allowance). The council estimates each 2‑bedroom council flat used as TA would cost only ~£3,000 net in year one (and ~£1,500/year thereafter), versus roughly £14,000 per year for a comparable private nightly-let unit. Overall, moving more families into council homes could save an estimated £280,000 per year in subsidy costs.

• Borrow £5 million to buy/build 20 new TA units. Cabinet members recommend adding a £5m HRA capital growth for 2025/26, to acquire or develop at least 20 more homes for use as TA. These could be purchased on the open market (if available), converted from existing buildings, or even constructed using modern, modular methods. The council notes that any new HRA TA units would still qualify for full benefit subsidy. (Council officers plan to seek Homes England grants if possible to offset some costs.)

• Work with Registered Providers (RPs) and developers. In the longer term, expanding affordable housing supply is critical. The Cabinet paper admits only 23 new affordable homes were delivered in the district in 2024/25 – well below the recent average (~75 per year). To reverse this, the council is stepping in on stalled S106 schemes and courting outside housing associations. By increasing lettings of new affordable homes in 2025/26 and 2026/27, more families could move out of TA into permanent housing.

Each of these measures has merit. As the report notes, every council‑owned flat used for TA immediately plugs the subsidy gap – 100% of the rent can be recouped. And owning more TA units means the council pays for building maintenance itself rather than expensive nightly rents. Securing outside funding (e.g. grants for new builds) could amplify the gains.

A Widening Gap: National and Local Challenges

However, even these steps may struggle to keep pace with demand. Nationally, TA demand is being driven by deep-rooted issues: shrinking affordability, rising rents, and reductions in welfare support. Private renting has become markedly more expensive – Shelter reports that only 2.5% of private rentals are affordable at the current Local Housing Allowance rate. In that environment, household budgets are squeezed: crisis charity research finds the poorest tenants are now spending more on rent, food and bills than their income – forcing more into arrears and evictions. Those evicted end up in TA because no cheaper options exist, creating a vicious cycle.

Locally, Folkestone & Hythe’s housing market is tight. House prices here average £303,000, far above the local income median, and long-term empty homes are in the hundreds. In fact, government data show 943 homes in the district have sat vacant for over six months. Many councils (including FHDC) offer grants or loans to bring empty private homes back into use, but take-up has been limited. Meanwhile, future supply of affordable homes is uncertain: construction costs and partner capacity are constraints. Even if RPs build more, those homes only relieve TA pressure gradually.

The council itself acknowledges these trade-offs. Its report cautions that converting HRA flats to TA will “place additional pressure” on housing stock and waiting lists. Large or family-sized council homes (already scarce) cannot all be diverted to TA without hurting homeless allocations. In other words, using too many council homes for TA could lengthen stays in TA or increase the waiting list for permanent homes.

Are These Measures Enough? Local Solutions To Consider

While Folkestone & Hythe’s plan may blunt the cost curve, many observers argue more must be done. Even using all available council homes and £5m of borrowing, the need may outstrip supply. The stark figures from homeless charities underline that long-term solutions lie in prevention and expanding affordable supply, not just emergency fixes.

Homelessness prevention and advice. Councils increasingly invest in early intervention to stop households losing their homes. In some areas, “tenancy rescue” or landlord liaison teams are active: for example, Milton Keynes has a “Call Before You Serve” service offering mediation and advice to landlords and tenants to avoid evictions. Housing ministers and charities advocate that every at-risk tenant should be able to access free legal advice, deposit support or discretionary housing payments before notice periods expire. Folkestone & Hythe could strengthen similar outreach – by publicizing hardship funds, rent negotiation, and arbitration services – to prevent families entering the TA system at all.

Landlord incentives and private leasing. To boost moves out of TA, councils often try to persuade private landlords to accept vulnerable tenants. This can mean one-off payments or guaranteed rent schemes. A recent survey found English councils paid out £31 million in private landlord incentives in 2024/25, on top of benefits – a heavy cost. FHDC already offers incentives and supplies to attract landlords (for example, payments for property improvements) and in 2024/25 paid out nearly £150,000; which is unstainable. Expanding these incentives – perhaps including longer leases or rent guarantees – might unlock more private lets for homeless families. Conversely, some critics argue that sinking money into incentives is “a senseless waste” when it merely props up an unaffordable market. It underscores the larger point: without affordable rents, even generous incentives may be rapidly outbid.

Using vacant homes. The paradox of TA costs is that hundreds of local homes stand empty. While some empties may be unsound or held for development, many could be refurbished quickly. FHDC’s existing empty homes grants and loans are steps in this direction. The council could consider more aggressive use of its statutory powers – such as Empty Dwelling Management Orders – to bring long-term empties back in circulation. Converting a fraction of those 943 empty homes into TA (or for low-cost rent) would ease pressure.

Modular and temporary housing. Modern modular construction and “homeless hostel” models are another option. The Cabinet report itself mentions the possibility of building purpose‑built TA units using modern methods. In practice, this could mean small flat packs or “pods” assembled on vacant sites – a faster alternative to traditional housing. In other UK areas, councils have trialled temporary villages of modular units to house families. Such schemes could expand Folkestone’s TA capacity more quickly than awaiting normal housing completions.

Supportive services for vulnerable groups. Finally, any homelessness strategy must link to social support. For victims of domestic abuse – who make up a sizeable share of homelessness cases – access to refuge space and move-on housing is vital. Reinforcing partnerships with charities (Women’s Aid, housing associations with supported lets) can help these households find safe long-term homes. Similarly, families released from care or the armed forces may need tailored housing advice and deposit help to prevent immediate homelessness.

In summary, Folkestone & Hythe’s proposed measures – greater use of HRA homes, £5m of TA acquisitions, and RP collaboration – will modestly relieve the budget strain. They are necessary steps, but likely insufficient on their own to curb the TA bill, given the depth of the housing crisis. As one housing campaigner notes, “temporary accommodation is the shame of our society” – and without more social homes or creative local initiatives, “the problem will keep bank­rupting” councils and devastating families. To address this emergency, Folkestone & Hythe may need to pair its capital plan with aggressive prevention, mediation services, landlord engagement, and use of all available housing resources.

The Shepway Vox Team

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