A group of London boroughs and housing associations plans to start a company to set up choice-based lettings schemes for other local authorities.

The company will be owned by Camden council – which is leading the initiative – as well as Islington, Westminster, Barnet and Enfield councils, and two associations, Ujima and St Pancras & Humanist.

The firm, Home Connections Lettings, will be registered for trading in the next few months.

It will set up the IT and communications technology – such as a text-message system of bidding for homes – needed to run choice-based lettings.

Choice-based lettings allow people on a local authority housing register to bid for homes rather than being allocated them.

Camden has provided a similar service for Kensington & Chelsea, Haringey and the four London boroughs that are co-owners of the company. It is also helping Birmingham council pilot a choice-based lettings service, to be launched in June this year.

This scheme, Urban Choice, will be piloted in the Lozelles, Handsworth, Birchfield and Gib Heath areas of the city.

It will cover 4500 to 5500 homes owned by the council and associations Midland Area, Hamac, Focus and Family. It could go city-wide in two years’ time.