New Homes, Old Problems: Just Where Is Hartlepool Borough Council Finding the Money?
- teessidetoday
- Dec 1
- 3 min read
Buying Houses on Borrowed Money — Hartlepool Borough Councils Housing Purchase That Doesn’t Stack Up Financially....
1st December 2025
Hartlepool Borough Councils facing questions over just how it intends to fund the purchase of up to nine new homes on the town’s South West Extension, known as Greatham Meadow, after official financial documents reveal the councils Housing Revenue Account simply doesn't have the resources available to buy them outright.
The News largely framed as a 'positive' by many of the mainstream outlets has been criticised for failing to ask one of the most important questions... just how will this actually be paid for ?
After reviewing the council’s most recent Finance & Corporate Affairs documentation — the same papers used by councillors to justify ongoing spending decisions — one glaring issue becomes impossible to ignore:
Hartlepool Borough Council’s Housing Revenue Account has neither the headroom nor the reserves to support high-value housing acquisition without the reliance on new borrowing.
The HRA is already operating on a knife-edge...
The council’s official quarterly finance report shows the Housing Revenue Account HRA is budgeted to return a surplus of just £8,000 for 2025/26 — and even that disappears in the forecast outturn.
The published figures show:
HRA Position 2025/26 | Amount |
Budgeted Surplus | £8,000 |
Forecast Outturn | £0 (break-even) |
Resulting Variance | £8,000 adverse |
In practical terms, the HRA has no spare revenue capacity at all.
It is carrying only:
£500,000 in reserves
— and even this figure is reportedly forecast not to grow in the current year.
That means that every repair, boiler breakdown, damp treatment or structural renewal for the councils entire social housing stock is supported by just half a million pounds in total. To put that into perspective, one major structural failure across multiple buildings could wipe that sum out completely.
So where does the council intend to find the funds to buy new homes from Persimmon?
There's only one realistic answer:
The Council Will Need to Borrow the money — Because the HRA Cannot Sustain Such Purchases Alone
The finance reports put to councillors only recently openly acknowledges that:
Reductions in voluntary contributions to the Major Repairs Reserve are being used to offset costs elsewhere — reducing future HRA resilience.…
In plain terms — money is already being shuffled around just to hold the councils HRA account together operationally. There's no spare cash for capital purchases of completed private sector homes, which means funding the acquisition would almost certainly require:
1. Borrowing through the Public Works Loan Board (PWLB), or
2. Reallocation of capital reserves intended for other essential works, or
3. A combination of both.
Given the council is already drawing down reserves to plug spending gaps, the likely outcome for the local tax payer is increased debt, future rent income being used to service loan repayments, and long-term financial strain on the council's housing budgets.
The Numbers Present a Far Bigger Problem
With damp and mould repairs alone forecast to cost Hartlepool Borough Council £159,000 this financial year, offset only by reducing future repair reserves, the HRA is clearly under pressure.…
Add house purchases on top of this and the logical contradiction is unavoidable:
How can a housing account posting a zero-balance outturn realistically support new-build acquisitions?
The answer is straightforward — it can't, not without external borrowing and future service consequences.
A Fair Question for Residents
Nobody can deny Hartlepool needs more housing. But needing housing and affording housing are not the same thing — and the council’s own documented finances paint a clear picture:
The Housing Revenue Account has flatlined
Repairs are already exceeding expectations
Future reserves are being weakened to patch overspends
A £500k safety buffer is all that exists
Purchasing new Persimmon properties will almost certainly rely on borrowing
Before the council signs on the dotted line, people need to know:
Nine homes are said to be getting bought? At what cost to the local taxpayer ?
Where's the money coming from ?
And what services are going to be cut in five years’ time to pay for them ?
Because based on the actual accounts, this decision appears financially unsound — with the people of Hartlepool being be the ones funding the consequences long after press releases and ribbon-cuttings have faded away.
