Folkestone & Hythe District Council homelessness costs: the complete guide

Folkestone & Hythe’s homelessness ledger tells a stark story. Between April and September 2025, the district council paid £543,556.40 for temporary accommodation, according to its own spending data. The vast majority—£438,188.00—went on self-contained nightly lets, with £105,368.40 spent on B&Bs and hotels. In other words, the expensive, privately managed, nightly-let market now dominates the bill. Those monthly outlays, and a running total for the six-month period, are set out in the accompanying graphic.

 A second chart tracks the council’s parallel effort to stop homelessness before it starts—its prevention spending through 2025/26—also with monthly totals and an overall figure to date. All figures are from Folkestone & Hythe District Council.

The costs are not an accounting quirk; they reflect a human queue that has grown longer and more complex. In a cabinet report published on 15 October, the council confirms that the number of households in temporary accommodation has roughly doubled in a year—from about 55 to around 115—and that the “negative subsidy” pressure on the general fund is projected at about £1.2m in 2025/26, up from around £925,000 last year. The same paper proposes a pivot away from nightly-let dependency: £5m of Housing Revenue Account borrowing to acquire “at least 20” additional council-owned temporary homes this year and a plan to switch a further 20 HRA properties into temporary use as they become available. Officers estimate that using council stock—where the authority can reclaim 100% of eligible housing benefit—would cut the general-fund subsidy gap by roughly £280,000 a year and avoid the worst economics of the nightly-let market.

None of this will surprise readers who follow the spending trail. In January, Shepway Vox flagged council temporary accommodation outturns at “their highest levels ever,” citing the authority’s published payments. While such headlines are easy to dismiss as alarmist, the council’s own October cabinet paper now hardwires the same message into policy: the costs are real, rising, and structurally embedded in the way the system pays for private provision.

What is the council doing to stop people entering the system in the first place? Its 2025/26 prevention ledger shows £434,641.62 spent so far this year on keeping threatened households safely housed—via rent-in-advance, deposits, landlord negotiation, and intensive casework. The Homelessness Reduction Act 2017 makes this a legal duty. When someone is “threatened with homelessness within 56 days,” the council must take reasonable steps to prevent it; if they are already homeless, it must take reasonable steps to relieve that homelessness for at least 56 days. Folkestone & Hythe sets those duties out plainly in its Homelessness Prevention Strategy 2020–2025, which also commits to earlier identification of risk and stronger tenancy sustainment so problems are dealt with before they become crises.

A second plank of the council’s approach is the Private Sector Offer (PRSO), a policy that allows the authority to meet its homelessness duty by placing households into a suitable 12-month private tenancy, subject to strict checks on affordability and suitability under the 2012 Suitability Order. Folkestone & Hythe’s Housing Allocations Policy states that, “in the first instance,” the duty to accepted homeless applicants will be discharged via the private rented sector, so long as the tenancy is appropriate and the affordability test is met. In practice, that means private tenancies are not a last resort—they are the default route out of temporary accommodation for many families.

Making that default work requires a genuine supply of willing landlords. Here, the council leans on its Property Solutions service, which offers a menu of incentives: £1,000–£2,000 cash payments depending on tenancy length, one month’s rent in advance, deposit bonds, and, where chosen, a managed service with guaranteed rent through ABC Lettings. The offer is as much about reassurance as it is about money—pre-tenancy inspections, inventories, legal advice and mediation are bundled in to reduce landlord risk and, ultimately, to keep lets stable. For a district with sharp affordability gaps and a churny private market, those sweeteners are the difference between rhetoric and placement. 

The wider picture underlines why Folkestone & Hythe is scrambling to change course. Across England in 2024/25, councils spent £2.84bn on temporary accommodation, up 25% in a single year, according to Shelter’s analysis of official returns. Crucially, the fastest-rising slice of that spend was the same category driving FHDC’s bill: nightly paid, privately managed self-contained accommodation. This is precisely the market the council now aims to escape by buying and repurposing its own stock.

If the proposed acquisitions go through, the economics change. The cabinet paper sets out a simple comparison. In a typical private nightly-let scenario, the council’s housing benefit subsidy is capped at 90% of the 2011 Local Housing Allowance rate, so a large chunk of the weekly rent falls back onto the general fund. By contrast, a council-owned two-bedroom temporary unit can be charged at a level where all eligible rent is reclaimable, leaving only management and maintenance to cover—costs that are predictable, controllable, and far lower than nightly-let leakage. The plan does not eliminate the subsidy gap—Nor will it produce savings overnight—but it would stop the haemorrhage growing, and, over time, bend the cost curve down. 

Policy, of course, is more than line-items and loans. The Homelessness Prevention Strategy 2020–2025 reads like a blueprint for the long game. It doubles down on early intervention, promising better information-sharing with partners so at-risk households are identified well before the Section 21 notice lands. It emphasises tenancy sustainment—the steady, unglamorous work of budgeting help, welfare advice, and conflict mediation that keeps a shaky tenancy intact. And it couples those efforts with a commitment to expand access to affordable homes, from recruiting more private landlords to building and buying additional council stock, including a longer-term pipeline beyond 2025. The logic is as old as housing policy itself: prevention first, swift relief where needed, and enough suitable homes to make both credible. 

For residents, the technicalities—subsidy caps, HRA borrowing, negative net expenditure—can sound remote. The reality is painfully local. A family placed out of area because nothing was available that night; a parent juggling zero-hours work and school runs from a hotel room; a landlord who might have said “yes” if the deposit bond had been on the table sooner. The council’s figures show tangible effort on prevention, and its strategy promises more. But the April–September ledger makes clear that the most expensive part of the system has become the most used. Until dependence on nightly-let stock is reduced, the district will keep paying 2025 prices while being reimbursed at 2011 rates.

What would success look like twelve months from now? Fewer households in nightly-let accommodation; B&Bs used only in genuine emergencies and only for the shortest possible stays; a prevention service catching more cases earlier; and a growing pool of council-owned temporary homes capable of absorbing demand without bleeding the general fund. The cabinet’s borrowing proposal is a necessary step towards that end. It will not solve everything—the national shortage of genuinely affordable homes sits beyond any one district’s control—but it would stop the fiscal weather from worsening every time a tenancy collapses.

The rise in Folkestone & Hythe’s homelessness costs is not unique, but the response must be. Between April and September 2025, FHDC spent £978,198.02 across crisis and prevention combined: £543,556.40 on temporary accommodation—£438,188.00 on self-contained nightly lets and £105,368.40 on B&Bs—and £434,641.62 on prevention. The district is small enough to move quickly, and its documents show a willingness to do so. If the council’s plan survives scrutiny and delivery schedules hold, the most telling numbers in next year’s ledger may not be the totals on those charts, but the quiet reductions hidden inside them: fewer nightly-let invoices, fewer emergency hotel bookings, fewer families living on a week-to-week promise. For now, the price of inaction is printed in black and white—and the monthly lines on FHDC’s own graphs show exactly where the money is going.

The Shepway Vox Team

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