Walsall council continued its run of poor inspection reports on 30 March when it was awarded no stars for strategic housing services by the Audit Commission.
However, inspectors said there were prospects for improvement.

The report said the council lacked structured arrangements for managing homelessness cases.

But Martin Palmer, lead housing inspector for the central region, said: "Walsall has worked hard to put in place the building blocks that will enable it to improve strategic housing. It has strengthened its management team and improved its strategy."

Walsall's string of bad reports dates back to January 2002's disastrous corporate governance inspection. That report almost resulted in government intervention for the council – the threat was lifted in August 2003 after a marginally better reinspection.

The council transferred its 26,000 homes to landlord Walsall Housing Group in March 2003.