Fortis Living and Waterloo Housing Group Voluntary Right to Buy Sales Policy

Transcription

1 Fortis Living and Waterloo Housing Group Voluntary Right to Buy Sales Policy

2 Scope of Policy This policy sets out the approach to be taken by Fortis Living and Waterloo Housing Group ( the Group ) in relation to those aspects of Voluntary Right to Buy (VRTB) where the Group has discretion. Applicability The policy applies to all members of Fortis Living and Waterloo Housing Group. 1. Policy Statement This policy is designed to set out how the Group will determine its approach to a number of areas in the Voluntary Right to Buy Deal, agreed between the National Housing Federation (NHF) and the Government. The policy is not intended to cover the approach to be taken where the following existing entitlements may exist, which are dealt with separately to this policy: Right to Acquire Existing Right to Buy for secure tenants Preserved Right to Buy 2. Context 2.1 This policy is set primarily within the context of the Voluntary Right to Buy deal agreed in October 2015 between the Government and National Housing Federation. This is in turn set within the wider context of the Housing and Planning Act 2016, which outlines how key aspects of the Deal will be funded. The key principles of the Voluntary Right to Buy Deal are as follows: Housing association tenants will have the right to purchase a home at Right to Buy-level discounts-subject to funding for the scheme; Housing associations will have the final decision about whether to sell an individual property, with the presumption that they will sell a tenant their current home where they can. Where housing associations decide not to sell the tenant their existing home, the Government has agreed to compensate housing associations if the discount is applied to an alternative housing association property purchased by the tenant (subject to certain conditions); Housing associations will get the full market value of the properties sold, with the value of the discount funded by the Government; and, Nationally, for every home sold under the deal a new affordable property would be built one for one thereby increasing overall supply. 2

3 2.2 The Government has decided policy areas such as overall eligibility for the Voluntary Right to Buy, how the discount will be funded and reimbursed, and how much the discount will be (see 4.12 discount levels are in line with the statutory RTB). A pilot of the scheme took place in A new two year regional pilot will be launched in the Midlands in Summer This will only be applicable to eligible tenants living in general needs properties, this applies to general family housing and dwellings for singles and couples and which is not part of an Independent Living Scheme or an Extra Care Housing complex. Guidance for the Midlands VRTB pilot was issued in May 2018 by MHCLG. This policy applies to the regional pilot and meets the Midlands VRTB Guidelines Aims and Objectives This policy sets out how the Group will deal with the following areas: Which properties to exercise discretion in relation to the Voluntary Right to Buy Deal Who is eligible for the VRTB How the Group will operate portable discounts The application process and how we will combat potential fraud The approach to replacement properties The complaints process Policy Outline The VRTB will allow all eligible tenants the right to buy a property at a discount. There is a presumption that the Group will sell eligible tenants the property in which they live. However, the Group has discretion to exclude certain properties from the VRTB which would prevent a tenant from purchasing it. In these cases the tenant will have the opportunity to port their discount to another property (see Appendix A for the Group s Portable Discount Policy). Tenant eligibility criteria Overall national eligibility criteria for the VRTB scheme is as follows (in line with Government requirements): Tenants are eligible if they live in general needs housing, this applies to general family housing and dwellings for singles and couples and which is not part of an Independent Living Scheme or an Extra Care Housing complex, and: they are over the age of 18; and they can prove they have been a tenant of social or affordable housing for at least three years (this need not have been with the same landlord, or continuous); and 3

4 they currently hold an un-demoted secure tenancy, an assured tenancy, or a Localism Act fixed term tenancy ; and they can demonstrate that the property is their main home and they have resided in it for at least the last 12 months; and if they are applying jointly with up to three family members, these applicants can also demonstrate that it is their main home and it has been their residence for at least the last 12 months. No joint applicant can be added to or removed from the application during the process without voiding the application, requiring a reapplication by the tenant(s). Joint applications where any applicant is ineligible will be voided; and they, and any joint applicants, have the right to reside in the UK, and can demonstrate that they meet the immigration status checks. 4.3 Qualifying period (in line with Government requirements) The qualifying period, and the period on which the discount is calculated, can include: o o o o o non-consecutive periods as public sector tenants; all undemoted secure or assured tenancies; fixed term assured short hold tenancies as long as they don t apply to the property being purchased; any probationary periods as long as they have been completed or do not apply to the property being purchased; any period spent as a public sector licensee (e.g. alms house; MOD tenant) even though they cannot buy such properties under the scheme. The qualifying period, and the period on which the discount is calculated, cannot include time spent as a non-tenant adult in a parental home. The onus is on the applicant to demonstrate that they qualify for the whole eligibility period being claimed. In exceptional circumstances, tenants can make a statutory declaration, but this would need to be supported by some indirect evidence (e.g. that the public sector landlord owned the relevant property for the period in question). 4.4 Tenants are not eligible if: they have Preserved Right to Buy or statutory Right to Buy; at the time of application, they hold an assured short hold tenancy (other than a Localism Act fixed term tenancy), a contractual (nonassured, non-secure) tenancy or are a licensee; they have a fixed term tenancy of less than 2 years, or if they have a periodic assured shorthold tenancy (including a starter/probationary tenancy which has not converted); 4

5 they do not have the right to reside in the UK, and cannot demonstrate that they meet the immigration status checks; they are currently subject to the mortgage rescue scheme. They will become eligible if they move to a new property or are granted a new tenancy; they are residents of almshouses or co-operative housing associations; they have any rent or service charge arrears; 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. Tenants would become eligible if such legal proceedings were withdrawn or discontinued; they are currently subject to legal proceedings or have an outstanding possession order against them, e.g. injunction proceedings have been issued or a notice of seeking possession (NOSP) has been served. Tenants would become eligible if such legal proceedings were withdrawn or discontinued, or if the landlord failed to send papers to the court for issue within six months of expiry of the NOSP, or the landlord loses the case in court (including following any appeal); they are subject to legal proceedings at any point between application and completion. Tenants would become eligible if such legal proceedings were withdrawn or discontinued; they already own a property at the point of application; and will not end their ownership on or before the completion of the Voluntary Right to Buy; 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 a shared house or flat, even if the terms of the occupancy amount to an assured tenancy; they are a shared ownership tenant. Please note that this list is not exhaustive applicants eligibility will be confirmed upon application. 4.5 Properties to be exempted from the Voluntary Right to Buy The Regional VRTB Pilot in the Midlands only applies to general needs properties. Independent Living schemes (Supported housing) and extra care schemes are not included in this pilot. The Group proposes to exempt the following categories of property from the Voluntary Right to Buy: Homes that are in an excluded rural area, where there is a restrictive covenant or local restriction on buying a rural home. Properties in which there are legal, funding or planning restrictions in place in legal binding agreements (e.g. section 106 sites where applicable, restrictive covenants, contractual clawbacks in transfer 5

6 agreements (except where the relevant local authority agrees to repay the clawback in full). Any home built specifically for customers with a specific disability, or where significant disabled adaptation has taken place, such as through floor lifts or property extensions, and where no household member requires the adaptation. Properties where there are significant shared facilities such as kitchens, bathrooms or laundries. The home is due to be sold/redeveloped/demolished as part of a wider regeneration scheme in the area in question. Homes in blocks over 6 storeys, where there are potential future large scale improvements due, which present possible complex management arrangements and potential expense. Specialist properties of historic interest (e.g. Almshouses) or that are of a type that would be difficult to replace. Properties where the Group does not hold a long-term interest in the property e.g. under Empty Homes Programme or where we do not have sufficient legal interest to be able to grant a lease exceeding 21 years for a house or not less than 50 years for a flat. Properties let in connection with employment where applicable. Properties where the sale would breach the cost floor and lead to a financial loss to the Group when sold. Properties provided through charitable or public benefit resource or bequeathed. Properties held in a Community Land Trust where the Group does not own the title to the land. Tied accommodation occupied because the tenant is employed by a social landlord. Leasehold houses as the Government has decided these cannot be sold under the VRTB pilot. Other properties may be excluded that would be inappropriate to sell, or which would otherwise compromise a scheme if sold. Please note that this list is not exhaustive. Applicants will be told about the eligibility of their property upon application. In the above circumstances the Group would propose that, subject to overall eligibility, the customer would be entitled to apply for a portable discount (see Appendix A Portable Discount Policy). 4.6 Approach to portable discounts Where the Group has declined to sell a property for the reasons outlined in 4.5 above, it is intended that the Group will offer eligible tenants an opportunity to use the discount they may be entitled to buy an alternative home (see Appendix A Portable Discount Policy). 4.7 Application process Please see VRTB process flowchart on the website for details regarding the timings to be followed by the Group and tenants at each stage of the process. Participation in the VRTB Midlands pilot is subject to the availability of Government funds in each financial year. Customers will 6

7 be advised as appropriate about whether the national digital portal is open for applications. Before a tenant can become eligible and the Group can process an application, the tenant must log their interest on the Government digital gateway and be accepted onto the funding programme. Once they have done this they will receive a unique reference number (URN) which must be noted on the Group s application form. Any application forms without a URN cannot be accepted and will be declined. In such cases a new application will have to be submitted by the applicant. The Group will operate a paper application process which applicants will be able to request from the Group. The website will also provide guidance for customers, outlining key factors such as entitlement, costs and discounts available. Details of all applicants will be logged on the Homes England IT System, and will be updated at key parts of the process. As part of the application process the Group will implement a number of supporting measures as part of the eligibility assessment process to eliminate potential fraud and confirm eligibility for the scheme (as set out in 4.2). These include the following measures: Interviews with applicants Request for original ID and tenancy verification documentation (see 4.8 below) from all members who are looking to purchase the property. In exceptional circumstances where all other options have been exhausted, a statutory declaration by the tenant would be acceptable evidence of the qualifying period. However, this should be accompanied by corroboratory evidence of occupation and/or landlord. Credit searches and inter-agency cross-referencing Liaison with local authorities (e.g. where an applicant is claiming benefit but declaring large amounts of savings) Ensuring that all those who are obtaining lending for the purchase are parties to the purchase. Immigration checks to ensure all those purchasing have the necessary immigration to be eligible to purchase the property. Ensuring third party companies funding the purchase are registered with the Financial Conduct Authority. If a tenant from another landlord ports their discount to a property owned by the Group, the Group will confirm that the correct checks have been carried out before completing a sale. 7

8 4.8 Tenancy Verification All tenants must agree to purchase the property or sign the VRTB application form to say that they do not wish to be included in the purchase. All documents will be checked in the presence of the holder to see if they appear genuine and do not appear to have been tampered with. All signatures will be checked against the Tenancy Agreement. If there is any discrepancy then the tenant/s will be asked to provide further evidence such as a Passport or Driving Licence to strengthen their application. Tenants may also be asked to provide ID and sign in front of the relevant officer. Copies of documents will be held by the Group for at least one year. If the tenant/signature cannot be verified then the application will be suspended until it has been. The Group may suspend an application at any time during the application process if the Group suspects fraud or money laundering refer to the Group Anti-Money Laundering Policy. The Group will aim to expedite investigations as quickly as possible. 4.9 Application fee Applicants will be required to pay an application fee of 250. This will need to be sent within four weeks of the Group sending an acceptance notice. The application cannot proceed, and a valuer cannot be appointed, until this fee is paid. This will be refunded either when the sale is completed or if the Group has to turn the applicant down because they do not meet the eligibility requirements. The fee will not be refunded if the applicant decides to stop proceeding with the sale for example, due to difficulty of raising the funds Valuation Applicants will be able to choose from a short list of local professional RICS certified surveyors compiled by the Group. The cost of carrying out the valuation will be met by the Group. Further details can be provided by the Group on request. Any applicants that wish to appeal the valuation will bear the additional costs of a second valuation (carried out from the list of surveyors compiled by the Group). The Group will pay for this cost where it requests the second valuation Repairs after Valuation No repairs will be carried out to the property once the application has been received unless they are required for the Group to comply with the following: Section 11 Landlord and Tenant Act 1985 Environmental Protection Act 1990 Section 4 Defective Premises Act

9 No planned improvement works will be undertaken to the property once the application has been received Calculation of discount The amount of discount for applicants will be calculated on the following basis as per the national VRTB deal. For each complete year of confirmed tenancy, the tenant is entitled to receive a discount based on a percentage of the open market value of the property. The total periods of qualifying tenancy are added together (years, months, days) and the discount is calculated on the total years. The monetary value of this percentage is deducted from the market valuation of the property. For freehold sales the tenant is awarded a 35% discount for the first five years and a further 1% for each additional complete year of confirmed tenancy, up to a maximum of a 70% discount or 80,900, whichever is lower. For leasehold sales the tenant is awarded a 50% discount for the first five years and a further 2% for each additional complete year of confirmed tenancy, up to a maximum of 70% or 80,900, whichever is lower. The maximum discount will be reviewed annually and increased if appropriate in line with the Consumer Price Index level of inflation (CPI). If a tenant has previously received funding under Right to Buy, Preserved Right to Buy or Right to Acquire, the discount should be reduced by that amount. Further details about the timings of the application and sales process are provided in the VRTB flowchart Post sale rights and responsibilities During the application process purchasers will be made aware of any service charge and ground rent commitments that they will need to pay following completion of the sale. This will also be reflected in any associated legal documents. If a tenant decides to sell their home within 10 years of buying it through the VRTB, the Group will have the right of first refusal. The tenant must first offer the property to the Group. The Group will inform the tenant whether or not it wishes to buy the property within eight weeks of notification by the former tenant. 9

10 Tenants and their Solicitor/Legal Representative will be required to register a legal charge at the Land Registry within 21 days of completion, and provide a copy of the registered title to the Group. This will enable the Group to ensure the enforcement of any repayment where conditions of the discount are breached. Tenants will be required to pay back some or all of the discount if they sell the property on within the first five years as below: 100% of the discount in the first year 80% of the discount in the second year 60% of the discount in the third year 40% of the discount in the fourth year 20% of the discount in the fifth year The date that triggers repayment is the date into which the former tenant enters into agreement to sell on the property. Tenants will also be required to pay back some or all of the discount if they sub-let the property within the first five years, as below: 100% of the discount in the first year 80% of the discount in the second year 60% of the discount in the third year 40% of the discount in the fourth year 20% of the discount in the fifth year The Group will have discretion not to require pay back of the discount if the former tenant would suffer hardship as a result. Any funding repaid by a tenant will belong to the Government. 5. Replacement properties 5.1 Subject to overall funding for the scheme, the Group will build or acquire replacement properties for those sold within our own housing stock as an addition to our existing development programme wherever possible (see also relevant Development Strategy). The Group may occasionally work with partner associations to build or acquire replacement properties where this would be appropriate. Where viable and practical, the Group will look to replace properties sold within the same local authority area. The Group will also potentially look to develop in wider geographical areas, including areas of housing/development growth, to respond as appropriate to housing needs and market pressures. Replacement homes will include a mix of type/size/tenures of affordable housing, including the following: Affordable rented homes Shared ownership homes or part rent part buy models 10

11 Starter Homes Rent to Buy 6. Complaints 6.1 Any customers who are unhappy with a decision made by the Group about the operation of this policy in their circumstances (e.g. where their property is exempted, they are determined to be ineligible, or in terms of the operation of the portable discount), will be able to complain in line with the relevant Complaints, Comments and Compliments Policy. 7. Promotion of VRTB 7.1 The VRTB scheme will be promoted on the Group s website and through updates in the tenant s newsletter. Relevant staff will be briefed about the scheme so that they are able to provide guidance to interested tenants. 8. Equality and Diversity 8.1 We are committed to fairness and equality for all regardless of their colour, race, ethnicity, nationality, gender, sexual orientation, marital status, disability, age, religion or belief, family circumstances or offending history, as referred to in our relevant Group policies. Our aim is to ensure that our policies and procedures do not create an unfair disadvantage for anyone, either directly or indirectly. An impact assessment has been carried out on the policy. 9. Monitoring and Review The next policy review is scheduled for We will monitor and report on the numbers of sales to management team and Board. 10. Associated Documents / Policies 10.1 List of documents / associated policies / publications :- Appendix A Fortis Living and Waterloo Housing Group Portable Discount Policy Voluntary Right to Buy Midlands Pilot Guidance for housing associations NHF Voluntary Right to Buy Deal Housing and Planning Act 2016 Fortis Living Asset Management Strategy Fortis Living Development Strategy Fortis Living Complaints, Comments and Compliments Policy 11

12 Fortis Living GDPR Policy Fortis Living Anti-Money Laundering Policy Fortis Living Memorandum of Understanding Between Housing Associations Relating to the Portability Aspect of the East & West Midlands Voluntary Right to Buy Scheme Waterloo Housing Group Asset Management Strategy Waterloo Housing Group New Build Development Strategy Waterloo Housing Group Feedback Policy Complaints, Comments and Compliments Waterloo Housing Group GDPR/Data Protection Policies Waterloo Housing Group Anti-Money Laundering Policy Author: Version: Final Policy Release date: August 2018 Next Review date: August 2019 Document type: Policy Approved by: Board EIA Completed Y (where required): Customer consultation: (where appropriate) Employee Handbook amends: (where appropriate) 12