Scheme for the Sale of Dwelling-Houses by Registered Housing Associations

1.1  This is the Scheme for the sale of dwelling houses (“dwellings”) by Registered Housing Associations (“ Housing Associations”) prepared under the provisions of Article 3 of the Housing (NI) Order1983 as inserted by Article 96 of the Housing (NI) Order 1992, and amended by Article 131 of the Housing (Northern Ireland) Order 2003. The object of the Scheme is to place a statutory responsibility on Housing Associations to sell their dwellings to secure tenants and succeeds the Voluntary Sales Schemes.

 

2.1  The right to buy only arises after the tenant has been a secure tenant (of theHousing Executive, a Registered Housing Association or of one of the bodies mentioned in the attached Appendix) for a period of not less than five years or for periods amounting together to not less than five years, but neither the dwelling nor the landlord need have been the same during the whole of that period. For the purposes of the scheme time spent as an introductory tenant will be taken into account. If the secure tenancy is a joint tenancy, the timequalification condition only has to be satisfied with respect to one of the joint tenants.

2.2  The following shall be treated as included in the dwelling:

2.3  (1)  A secure tenant may purchase jointly with up to three other persons. Each of the other persons must satisfy one or both of the following conditions:

2.3.  (2)  A secure tenant may only acquire a dwelling as a "tenant in common" where his/her interest or share in the dwelling upon completion is at least 25%.

 

3.1  Under the Scheme, any dwelling may be sold with the exception of.

3.2 In the present context the term ‘group housing’ refers to any individual house  which is part of a group of houses which have been designed for persons with special needs where either:

3.2.B  A secure tenant cannot exercise the right to buy at any time when any of the following circumstances apply to him:

3.2.C A "relevant statutory notice" means a Notice Seeking Possession on one or both of the following grounds:

3.3  Applications to purchase made by secure tenants who are in rent arrears  shall not be rejected on those grounds but shall be allowed to proceed to completion stage.  However, no sale shall be completed until all arrears whether for rent or any other payment due from them as a secure tenant have been paid.

 

4.1  Subject to the provisions of Section 5.0 below, the purchase price shall be the market value less any available discount.

4.2 The market value shall be that assessed by a suitably qualified professional valuer as at the date of the completed application to purchase (i.e. date of receipt of all required information). The valuation will be adjusted to take account of any improvements which were carried out to the property by the tenant.

4.3  The secure tenant shall be notified of the purchase price within 12 weeks of making the application to purchase.

4.4 The secure tenant shall be advised of any structural defects known to the Housing Association which affect the dwelling or the building in which it is situated.

4.5 The purchaser, if not satisfied with the assessment of market value, shall be entitled to request a re-determination of the purchase price. Such re-determination shall be carried out by the District Valuer of the Valuation and and Lands Agency or by some other official of the VLA nominated by him/her. Any request for a re-determination must be made in writing within one month of the offer being made.

4.6  In the case of the sale of flats/maisonettes the purchaser shall be required to pay an annual rent of £10 and an annual service charge. (The annual service charge shall include the relevant proportion of the estimated cost of repairs, maintenance and improvements programmed to be carried out in that year to the block in which the flat is located). The Housing Association shall, when making a formal offer to the secure tenant of a flat, give details of any works proposed to be carried out in the next 5 years together with estimated costs and service charges for those years.

 

5.1 Discount shall be offered to secure tenants in relation to the total number of  years which they have spent as secure tenants of relevant accommodation (i.e., of the authorities or bodies listed in Appendix 1).

5.2 The discount shall not reduce the price below the Historic Cost. The Historic Cost is the amount, which is to be taken as representing so much of the costs incurred in the provision, improvement or acquisition of the dwelling as is to be treated as incurred in the relevant period (the financial year in which the application to purchase is made and in the 10 previous financial years). Housing Associations must be able to demonstrate, in such a way as is verifiable, the method used to calculate the historic cost. If the price before discount is below the historic cost amount there shall be no discount and the purchase price shall be the market value price. Where the aggregate of the costs incurred in respect of improvement works is less than £5,000 throughout the relevant period, those costs can be disregarded. For the purposes of this paragraph, the Housing Association can estimate the costs incurred, however, any such estimate must be a reasonable and verifiable estimate.

5.3 Tenancy periods with former Public Sector bodies which have now been privatised shall be eligible for discount only in respect of the period up to the date of privatisation.

5.4 Time spent in any accommodation provided for Regular Armed Forces of the Crown shall also count for discount.

5.5  Subject to paragraph 5.6 below, secure tenants of a dwelling (house, flat or maisonette) with 5 years completed tenancy shall be allowed discount of 20% with an increase of 2% for each additional completed years tenancy up to an overall maximum of 60% subject to the Historic Cost proviso contained in paragraph 5.2.

5.6  The discount shall not in any event reduce the price of the dwelling by more than £24,000.

5.7  Where a spouse succeeds to the tenancy on the death of his/her spouse he or she may take the benefit of the discount rights of the deceased spouse provided that both were occupying the dwelling as their principal home at the time of the death of the deceased spouse.

5.8 In cases of joint purchase (i.e. a purchase by a secure tenant along with an eligible co-purchaser) it is only the periods spent by the secure tenant in relevant accommodation that will count in the calculation of discount. Where joint tenants purchase a dwelling jointly discount shall be based on the tenancy period(s) of the secure tenant who has spent the longer period as a secure tenant of relevant accommodation.

5.9  Periods during which the secure tenant's spouse was a secure tenant or was previously the spouse of another secure tenant shall be taken into account provided both the secure tenant applying to purchase and his spouse occupied the dwelling as their only or principal home at the time of the completed application to purchase.

5.10  A spouse of a secure tenant who is separated or divorced may take the benefit of the tenancy periods of the former spouse in the original dwelling when purchasing the dwelling he/she now occupies provided that during those periods they were occupying the original dwelling as their only or principal home.

5.11  Discounts will be calculated as at the date of a completed application to purchase.

5.12  Where a secure tenant of a dwelling dies or otherwise ceases to be a secure Tenant (“the former tenant”), and subsequently, a child of the former tenant  who occupies the dwelling as his/her only or principal home succeeds to the tenancy of the dwelling ("the new tenant"), and the new tenant applies to purchase, discount shall be granted to the new tenant based on the number of years during which the new tenant resided in the dwelling after his/her 16^th birthday (whether under the same tenancy or under another secure tenancy). A break in that residence qualification is permitted where that break has been for two years or less, and in such cases full discount rights back to the 16^th  birthday shall be allowed. If the break is for more than two years, discount rights shall only be allowed from the date of the new tenant's return to the dwelling after the break.

5.13  Where an application to purchase has been lodged by a secure tenant and where a child of that secure tenant succeeds to the tenancy of the dwelling before the completion of the purchase by the secure tenant, the child shall be entitled to receive the full discount rights of the parent if that child wishes to continue with the purchase of the dwelling.

5.14  A soninlaw or daughterinlaw who occupies the dwelling and succeeds to the tenancy shall be treated as a 'natural' son or daughter.

5.15  A child will not be treated as a successor for discount purposes unless one of the following sets of circumstances apply to him/her:

5.16  Where a person, or one of the persons, applying to purchase a dwelling was a previous purchaser, all previous tenancy periods shall be taken into account in assessing discount allowable. However, the discount entitlement on a second or subsequent purchase shall be reduced by the cash value of any discount allowed previously less the amount repaid to the Housing Association on previous disposals (if any). Where a previous discount was given to two or more persons jointly, this paragraph has effect as if each of them had been given an equal proportion of the discount.

 

6.1  The legal documentation shall contain a covenant binding on the secure tenant and his/her successors in title to repay to the Housing Association the full discount received if within a period of 5 years there is a disposal falling within paragraph 6.2, but if there is more than one such disposal, then only on the first of them.

6.2  A disposal is:

but the following categories of disposal do not attract repayment of discount:

 

7.1  (1)  The Housing Association may include in a conveyance or lease such conditions as the Department for Social Development may approve.

7.1  (2)  The Housing Association shall include in a conveyance or lease any conditions or covenants which the Department for Social Development may specify.

7.1  (3)  The Housing Association shall include in a contract and in a conveyance or lease a clause whereby the purchaser must agree that if he/she wishes to dispose of the dwelling within 10 years from the date of purchase the Housing Association or any other registered housing association will be given the option to re-purchase.

7.2  Without prejudice to the generality of paragraph 7.1, the conditions and covenants