Voluntary Right to Buy Policy. Dan Gray, Executive Director, Property

Transcription

1 Policy title: Scope: Policy owner & job title: Approver: Voluntary Right to Buy Policy Aspire Housing Alice Newman, Land and Stock Intelligence Manager Dan Gray, Executive Director, Property Date: 07/2018 Review Due Date: 07/2021 POLICY SUMMARY In September 2015, the National Housing Federation (NHF), on behalf of the housing association sector, made an offer to Government to extend Right to Buy level discounts to eligible customers through a voluntary rather than statutory approach, known as the Voluntary Right to Buy (VRTB). This policy sets out Aspire Housing s approach to managing the VRTB scheme within the parameters agreed between the housing sector and Government. Associated Policies & Procedures: Preserved RTB & RTA Policy Preserved RTB & RTA Procedure Voluntary RTB Procedure 1. POLICY STATEMENT Aspire Housing will comply with the spirit of the voluntary deal agreed between the sector and Government, having specific regard for the scheme guidance that has been published by the Ministry of Housing, Communities and Local Government (MHCLG). Aspire will support eligible customers who wish to exercise the Voluntary Right To Buy (VRTB) to realise their aspiration of home ownership. 1.1 Scheme Overview The VRTB deal agreed between Government and the housing sector is based on four principles: - Right to Buy discounts will be available for housing association customers The presumption that housing associations will sell customers their home. If the association wishes to exclude the property from the scheme, there is a requirement to offer a portable discount towards the purchase of an alternative property. - Board retains control over which homes to sell

2 Housing associations are expected to sell properties through the scheme, however, Boards will retain the discretion to exclude properties that they do not wish to sell. - Full compensation will be paid to housing associations Government will refund the housing association 100% of the discount. - One for One Replacement For every home sold it is expected that a new affordable home will be built in its place, thereby increasing overall supply. This excludes new units developed through s106 agreements (without the consent of the HCA) or through the Affordable Homes Programme. It is expected that one for one replacement will not be at a Housing Association level but at a national level. 1.2 Customer Eligibility The Midlands Regional VRTB pilot scheme includes general needs housing only, therefore all supported housing schemes are out of scope and not subject to portability. General needs customers are eligible for the scheme if they can evidence that they have been a tenant of social or affordable housing for at least 3 years at the point of application. This does not need to have been with the same landlord or a continuous tenancy. Customers are not eligible if: They have the statutory Preserved Right to Buy; At the time of application, they hold an assured shorthold tenancy (other than a Localism Act fixed term tenancy), a contractual (non-assured, non-secure) tenancy or are a licensee; They have fixed term tenancy of less than 2 years, or if they have a periodic assured short hold tenancy (including a starter tenancy which has not converted); They are not British nationals and cannot demonstrate that they meet the immigration status checks; They are currently subject to the mortgage rescue scheme. They are residents of alms-houses or co-operative housing associations; They have any rent arrears at the point of application and/or completion; They or any joint applicants are subject to bankruptcy proceedings or unfulfilled credit arrangements; They have committed anti-social behaviour as defined in the Paragraph 11 of Schedule 11 to the Anti-Social Behaviour, Crime and Policing Act 2014 and the housing association has initiated legal proceedings as a result of this. They are currently subject to legal proceedings, e.g. injunction proceedings have been issued or a notice of seeking possession (NOSP) has been served. They already own a property even if it is not their principal residence at the point of application; Page 2 of 7 Voluntary Right to Buy Policy 2018

3 They hold an assured fixed term tenancy where the original term was 21 years or more (i.e. a long term tenancy); They occupy only a room, or rooms, in shared house or flat, even if the terms of the occupancy amount to an assured tenancy; They are a shared ownership tenant. Aspire will carry out comprehensive and robust eligibility and immigration checks within the application process to ensure that ineligible customers are not able to purchase. The responsibility of providing evidence of residency and qualifying periods remains solely with the applicant and not providing the required evidence within specified timescales may result in the application being refused. 1.3 Property Eligibility Aspire has chosen to exclude a number of categories of property from the VRTB scheme and therefore these are not available for purchase by customers. Examples include properties with a legal restriction, properties that would be difficult to replace and properties where a sale may conflict with wider business objectives. These exclusions are set out in Appendix Portable Discounts In the event that Aspire has exercised its discretion not to sell a property, the eligible tenant has the option to port their discount to another eligible property under the terms of the portability policy, as set out in Appendix 1. The level of discount will be determined by the alternative property that is offered to the customer. 1.5 Application Process Aspire will endeavour to carry out full person and property eligibility checks within 4 weeks of receipt of the application, unless there is a need to validate information with previous landlords or there is a complex tenancy history which requires in-depth investigation. Aspire will not accept an application from a customer while the rent account is in arrears. Once an application has been received no further planned improvement, repair and/or renovation work will be completed, other than essential emergency works. Aspire will charge the applicant an application fee in line with the terms of the scheme. The application cannot proceed, and a valuer will not be appointed, until this fee is paid. If the tenant does not engage with the valuer, or misses two appointments, the application will be closed. A valuation of the property will be carried out by a RICS qualified surveyor commissioned by Aspire. The surveyor will be drawn from a short list of local professional RICS certified surveyors compiled by Aspire. Should either party wish to appeal the valuation the relevant party will bear the costs involved in appointing another surveyor. Page 3 of 7 Voluntary Right to Buy Policy 2018

4 The discount to be applied will mirror that provided under the statutory Right to Buy Scheme. The discount will be calculated by the Strategic Asset Management team and signed off by the Finance Team before an offer is sent to the customer. The application will be recorded and updated on the HCAs Investment Management System (IMS) at the relevant milestones in line with the scheme requirements and the conditions of the Capital Funding Guide. At any point during the application process, if fraud or money laundering is suspected the application will be suspended to carry out investigations without penalty. Investigations will be carried out as quickly as possible and it is expected these will take no longer than 6 months. Should Aspire have reason to believe that fraud or money laundering is being committed, it will make a report to the appropriate authorities in the required form. 1.6 Completing the Sale If the applicant is securing a mortgage, the lender must be registered with the Financial Conduct Authority. If the applicant is purchasing with cash, they must provide evidence of how this is being funded which will require the applicant to provide copies of bank statements. If the applicant is being gifted the funds, a funding declaration will need to be signed and witnessed by a solicitor. Completion of a purchase under the VRTB scheme will not be permitted unless the rent account is clear. Timescales for completion will be clearly outlined throughout the process and it is the customer s responsibility to ensure that these are met, failure to adhere to application timescales may result in the application being cancelled. The discount is funded by Government and applications will only be allowed to complete following confirmation that funding is available to pay Aspire in full. 1.7 Replacement of sold properties Where a property is sold under VRTB, Aspire will endeavour to replace the property in line with the scheme guidance. Aspire will be proactive in assessing market conditions and identifying available development opportunities to facilitate the replacement of properties sold under the scheme. It is expected that most sales will incur in Newcastle-under-Lyme and that replacements will be delivered in line with the Development Strategy and the availability of suitable opportunities. 1.8 Promoting the Scheme The scheme will be promoted in line with the spirit of the VRTB deal agreed between Government and the housing sector. Page 4 of 7 Voluntary Right to Buy Policy 2018

5 Aspire may choose to undertake targeted marketing of the scheme to specific groups of customers in support of delivering outcomes required by its Asset Management Strategy or Development Strategy. 1.9 Audit and Assurance All applications will be processed with the appropriate internal sign-off as per the preserved RTB scheme and in line with the key milestones of IMS system entry. These milestones are acceptance of application, formal offer stage and completion. Audit files will be set up for each property sold using the standardised government checklist Complaints All complaints will be dealt with in line with our internal complaint handling process. If the internal process has been exhausted and the applicant is not satisfied with the outcome, they can refer the matter to the Housing Ombudsman. Equality & Diversity: This policy has been considered against our Equality and Diversity Policy and no additional provisions are required. Page 5 of 7 Voluntary Right to Buy Policy 2018

6 2 RESPONSIBILITIES OF EMPLOYEE Strategic Asset Management Team - Provide clear and accurate advice to applicants - Manage customer expectations in relation to the scheme - Keep an auditable record of applications received and completed sales - Promote the scheme in line with published guidance - Maintain, process and manage applications consistently in relation to the guidance and procedures - For all applications carry out the necessary checks to confirm person and property eligibility - Process and manage applications on IMS - Ensure the appropriate audit files are maintained for all applications in line with Government guidance - Provide an appropriate level of support to any customer who wish port their discount from an ineligible property Finance Team - Maintain a separate ledger for recording of VRTB sales and discount receipts - Develop appropriate registers to evidence the replacement of lost units - Manage the process of grant claims to ensure that compensation is received - Ensure accurate reporting to Government on replacements funded from VRTB proceeds Development Team - Ensure a proactive approach to the development of replacement units Marketing Team - To support the Strategic Asset Management team to market the scheme through the appropriate channels Neighbourhood Team - Support customers in exercising portability, managing expectations 3 RESPONSIBILITY OF ASPIRE Page 6 of 7 Voluntary Right to Buy Policy 2018

7 To deliver the VRTB scheme in accordance with the spirit of the voluntary deal, agreed between Government and the housing sector, and the scheme guidance published by MHCLG. Page 7 of 7 Voluntary Right to Buy Policy 2018

8 Appendix 1 - Sales and Portability Policy 1.0 Sales Policy A central principle of the agreement to extend Right to Buy discounts to housing association customers is that individual Boards will have the discretion to exclude properties from the scheme. Aspire has chosen to exclude some of its properties from the VRTB scheme and these properties may not be purchased by our customers. This will include properties with a legal restriction on sale, properties that would be difficult to replace and properties whose sale may conflict with wider business objectives. Circumstances in which properties will be excluded Bungalows, being defined as self-contained dwellings without shared facilities, with a majority of the accommodation on a single level Rationale To preserve properties of this type, which are in high demand and are suitable for a growing demographic group (Exception- Any Non-Traditional construction Kencast bungalows that have not received major repairs and upgrade work are included in the scheme) Properties with a major adaptation, such as a through floor lift, property extension, adapted kitchen, wet room or external ramp with step lift that are intended to support individuals with disabilities. Properties identified within the Asset Management Strategy for options appraisal which may result in redevelopment or disposal Properties in certain rural parishes identified by the Government and set out in s17 (1)(b) ( right to acquire: supplementary provisions) of the [1996 c.52.] Housing Act This includes the real areas of Keele, Madeley, Maer and Loggerheads and some parts of Betley, Audley and Kidsgrove. Four and Five Bedroom Houses Properties with a legal restriction, planning condition or S106 agreement which prevents sale as a private non-affordable dwelling Housing that cannot be sold as a condition of secured lending (The sale of these properties aligns with the priorities in the Asset Management Strategy) To protect the investment made in carrying out major adaptations for future occupants of the property A sale would delay or prevent business priorities outlined within the Asset Management Strategy Properties within these locations would be difficult to replace To preserve properties of this type which are in high demand and small quantities A sale would bring risk of subsequent legal action A sale could mean a default on a loan agreement

9 Properties affected by the Net Debt or by the Cost Floor rules. This includes properties where the net debt/cost to build the property, including land purchase and associated cost, plus the subsequent improvements (less any grant) are greater than its market value Flats within in a block where Aspire is the freeholder and there are 2 or fewer rented flats remaining at the point of application. A sale would create a financial loss to the company and pose a risk to financial strength A sale of the remaining flats could impact negatively on the future sale or redevelopment of the entire block. In circumstances where a sale would have a detrimental impact on the Associations income and/or lending agreements a sale would be refused. The above list is not exhaustive and other properties may be considered on a case-by-case basis should it be identified that their sale would conflict with wider business objectives or due to legal restrictions. In addition to the above there are also a number of Aspire Housing homes which are exempt from the scheme due to nature of the tenure. This includes - Shared Ownership properties where a lease is in place - Tenants currently subject to the mortgage rescue scheme - Properties which are let at market rent 2.0 Portability Policy 2.1 Eligibility Eligible customers living in properties which Aspire Housing has exercised its discretion not to sell will have the opportunity to port their discount to another property. Following receipt of an application Aspire Housing will confirm to the applicant whether they are eligible to port their discount. Aspire will work proactively with applicants to find an alternative property to which they may port their discount and applicants are expected to play an active role in supporting this process. 2.2 Options available for the portable discount Aspire will make one reasonable offer of a suitable alternative property through any of the following means: An existing Aspire void property that is both eligible for sale under the scheme and available through either natural turnover or the voluntary disposal programme Mutual exchange with another customer New build pipeline property being developed by Aspire Housing and available for sale on an open market basis

10 A referral to another Registered Provider with a suitable alternative property available for sale 1) Offer of an eligible Aspire void property Aspire will provide applicants with the opportunity to bid over a 3 month period on suitable properties that become available through the void process. The suitability of the property will be determined by Aspire Housing and will be based upon the needs and circumstances of the applicant. This will reflect the Lettings Policy and the Government s Welfare Reform criteria, whereby the property offered will meet the needs of the current occupants of the property in which the applicant lives. The property offered will not necessarily be of the same size or type as the current accommodation, although Aspire will have regard for the applicant s preferred type, location and size of property. During the 3 month period Aspire will also offer one direct match of a suitable property taking into account the applicant s preferred property type, size and location taking into account the applicant s current housing need When a suitable property is identified through either the bidding process or a direct match, whichever comes sooner, it will be offered to the applicant. To avoid unnecessary rent loss the property must be viewed and accepted within 3 working days. If improvements have been made to the applicant s existing home (e.g. decorating, alterations, fittings etc.) these will be disregarded when finding a suitable alternative and no compensation will be due. If the property the applicant is porting from has adaptations it will be the applicant s responsibility to arrange funding for new installations once they have purchased their replacement home. The void property to which the applicant is porting will meet Aspire s lettable standard at the point of purchase. If the applicant accepts the replacement property they will be requested to move into the property within reasonable timescales. They will be awarded a 2 year fixed term tenancy and if the purchase is not completed within this timeframe, the fixed term tenancy process will be followed which could result in the tenancy ending. If a property has not been accepted by the applicant within 3 months, either through the applicant bidding directly or a direct match offer made by Aspire, the application will be closed down. 2) Mutual exchange with another customer The applicant may also use the mutual exchange process to identify a suitable alternative property to purchase using their portable discount. Any potential mutual exchanges will require Aspire to confirm that it is eligible for VRTB and a suitable property for the applicant.

11 The mutual exchange process requires both parties to have a clear tenancy record and the properties to be in good condition before a move and purchase will be approved. 3) New build pipeline property being developed by Aspire Housing and available for sale on an open market basis Applicants will be made aware of any suitable new build pipeline properties being developed for sale by Aspire Housing that are not subject to a s106 agreement or part of a Homes England funded scheme. Should the applicant progress this option and a suitable alternative property be offered to the applicant, this will meet the policy requirement of making one reasonable offer. 4) Referral to another Registered Provider with a suitable alternative property available for sale Applicants will be made aware of the potential option to purchase a home from another Registered Provider subject to formal arrangements being in place between Aspire and other providers to enable a referral. Aspire will provide support to the applicant by making them aware of the areas in which partner providers hold stock and will engage with other providers as necessary to determine whether any properties are currently available. Should the applicant progress this option and a suitable alternative property be offered to the applicant, this will meet the policy requirement of making one reasonable offer. Should an applicant relocate to another property and the purchase not be completed Aspire will not support a transfer back to the original property or locality. Throughout the process of porting, applicants will be signposted to other potential home ownership schemes available on the open market. 2.3 Cancellation of Applications A VRTB application will be cancelled in the following circumstances: The applicant does not wish to take up the portable discount option The applicant does not proactively support the process of identifying a suitable alternative property The applicant purchases an alternative property on the open market or through the Help to Buy shared ownership scheme A suitable alternative property is not identified within existing Aspire void stock, through a mutual exchange or via another partner housing association The applicant turns down a reasonable offer of a suitable property to purchase Following a three month period during which the options set out above have been explored and no suitable alternative property is identified or accepted by the applicant 2.4 Discount Calculation

12 The discount and valuation will be based on the property to which the tenant ports the discount and not the property in which they live at the point of application. 3.0 Complaints If an applicant disputes the refusal or closure of their application, or the suitability of any property offer that is made, this will be dealt with through the existing complaints process. If the internal process has been exhausted and the applicant is not satisfied with the outcome, they can refer the matter to the Housing Ombudsman.