Based on a new study of municipal councils, English councils are planning to sell community centers, sports centres, and retail spaces as they bet on a fire sale of properties to stabilize finances.
Growing Financial Challenges Drive Asset Sales
The Key Cities Group representing second-tier cities in England reported that 60% of local authorities are intending to sell assets to cover the escalating costs of social services for vulnerable individuals.
Local governments have in the past faced criticism for selling playing fields and open spaces to shore up their finances, but they argue they must continue to generate essential revenue from property disposals or face insolvency.
The group noted that a significant number of councils attempting to raise money from a quick sale of holdings represented “a clear change from 2024, when the majority (60%) of municipal officials said they would focus on service redesigns and utilising savings to manage growing fiscal pressures.”
Specific Examples of Planned Disposals
One local authority in southeast England announced its property management strategy featured the disposal of a retail complex in Rainham and a community venue in another town to generate £20m over the next half-decade.
- A local golf course and business parks owned in Worcestershire and Suffolk, which all generate rent for Medway council, will also be disposed of under the strategy.
Council Tax Increases and Wider Financial Strains
The survey of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of authorities will need to raise council taxes next spring to address the rising cost of essential services, increased rates of housing insecurity, and a persistent housing shortage.
The authority said it will press ahead with property disposals after sharp increases in the cost of youth support, support for vulnerable learners, adult social care, and short-term housing.
“We are adopting creative strategies but certain measures take time to deliver both improved services and financial savings,” stated a council leader.
He added: “We face population challenges which will persist to add to the strains we have. As a local government body, we had a drastic reduction in our revenue support grant from over the past decade, which is extremely difficult.”
Countrywide Patterns and Forecasts
Research of regional authorities this week further found council budgets being strained by the growing number of children and older individuals needing Send support.
A network of councils projected that local shortfalls will reach 4.4 billion pounds a year by 2029, as they struggle to manage rising needs.
Ministers have delayed scheduled changes to the special educational needs framework until next year after a white paper outlining those reforms was recently delayed.
Deprivation and Financial Shortfalls
According to the latest indices of deprivation (the Index of Multiple Deprivation) for English councils, several participating urban areas were among the most disadvantaged in the country.
- “Member cities like several major towns place in the most deprived 30 across the country under the 2025 deprivation indices,” said the report.
“Although only a single urban area is among the top 10 for deprived neighbourhoods nationally, cities are far more likely to be in the most deprived fifth of the nation. The data highlights the extent of challenges facing local leaders across major urban centers in the coming year,” the report concluded.
“Local government leaders have been clear about the necessity for a equitable and lasting funding system that reflects and addresses the real levels of deprivation and demand,” said Michael Mordey.
“Lacking this, councils will persist to face impossible choices around which essential services to fund, and which to cut, to the detriment of their communities.”
One in five of councils have reduced or weakened social care provision in the past 12 months, the study found.
