NEWPORT council has agreed to start consulting tenants from yesterday on whether to transfer the city's 9,000 council homes to a new landlord. In nine to 15 months, tenants will be asked to vote 'yes' or 'no' to transferring the homes.

This transfer is the only way the council believes it can raise the £240 million investment needed to bring the properties up to Assembly standards by 2012 and pay off the debt arrears of the housing department.

Councils, unlike housing associations, cannot borrow to carry out repairs or improvements. Across Gwent, Torfaen and Monmouthshire are already consulting on transferring their stock, Blaenau Gwent are carrying out a preliminary survey to see whether they would look at a transfer but Caerphilly say they are confident they can meet the costs of upgrading their homes.

Newport council leader Bob Bright said: "I think we all know the grave situation that will occur if this decision is not taken."

Both he and Liberal Democrat councillor Veronica Watkins stressed the importance of telling tenants properly about the move so they are informed when it comes to the vote.

Councillor Watkins said: "Housing is an emotive subject...but we should take this forward with enthusiasm."

But Conservative councillor David Fouweather is still concerned the transfer would mean handing over council assets for too little money. He suggested the radical move of selling the council properties to tenants at the same rate they are being offered to the new registered social landlord.

Councillor Fouweather said: "We don't know how much these properties are going for.

"The council is going to give away the housing lock, stock and barrel." Councillor Bright dismissed the suggestion as unrealistic.

He said: "We are not selling these properties, we are transferring them. "There is a difference between the value of a property and the value of handing over management of it with all its liabilities."

He said selling the council stock would not address the lack of social housing or help people who cannot afford to buy their homes.