According to a new study of municipal councils, UK councils are planning to sell community centers, athletic facilities, and shopping arcades as they bet on a fire sale of properties to stabilize finances.
Growing Financial Pressures Prompt Asset Sales
A coalition of councils representing second-tier cities in the UK reported that six out of ten of councils are planning to dispose of properties to cover the escalating costs of adult and children’s social care.
Councils have in the past come under fire for disposing of public land and open spaces to shore up their budgets, but they argue they must proceed to generate essential revenue from property disposals or face insolvency.
This coalition said that a significant number of councils attempting to generate funds from a fire sale of holdings marked “a clear change from 2024, when the majority (six in ten) of municipal officials said they would focus on service redesigns and utilising savings to manage growing financial challenges.”
Specific Cases of Proposed Disposals
One local authority in Kent announced its asset disposal plan included the sale of a retail complex in a local town and a community venue in another town to generate 20 million pounds over the next half-decade.
- A local golf course and business parks owned in Worcestershire and Suffolk, which all generate rent for the authority, will additionally be sold under the plan.
Local Levy Rises and Wider Financial Strains
The survey of local authorities in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of authorities will need to raise council taxes next spring to address the growing cost of essential services, increased rates of housing insecurity, and a longstanding housing shortage.
Medway council explained it will proceed with property disposals after sharp increases in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and short-term housing.
“We are taking creative strategies but some of these require time to achieve both better provisions and cost efficiency,” stated a council leader.
He continued: “We face population challenges which will persist to add to the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from over the past decade, which is extremely difficult.”
National Trends and Forecasts
A survey of regional authorities recently also found local finances being strained by the growing number of children and older individuals requiring special educational assistance.
A network of councils projected that council deficits will reach £4.4bn a year by 2029, as they struggle to cope with rising needs.
Ministers have delayed scheduled changes to the Send system until next year after a policy document outlining those reforms has been postponed.
Disadvantage and Financial Shortfalls
According to the latest indices of deprivation (IMD) for UK local authorities, many participating urban areas were among the most disadvantaged in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the most deprived 30 across the country under the 2025 deprivation indices,” noted the study.
“While only a single urban area is in the top 10 for disadvantaged communities countrywide, cities are much more prone to be in the worst-off 20% of England. The data underscores the extent of difficulties facing municipal officials across key cities in the next twelve months,” the report added.
“Council officials have been explicit about the need for a fair and sustainable funding system that accounts for and responds to the real levels of deprivation and demand,” stated Michael Mordey.
“Without this, councils will persist to face impossible choices around which vital provisions to allocate spend to, and which to reduce, to the detriment of their residents.”
A fifth of local authorities have cut or compromised care services in the past 12 months, the survey found.
