HAs and judicial reviews

Housing associations will find it easier to avoid being made subject to judicial reviews after a court today ruled they are not public bodies.

Accoring to inside housing:

“London landlord Peabody won its High Court battle against a tenant who was challenging their decision not to exchange his tenancy with a property in Edinburgh.

Dismissing his claim, the judge Justice William Davies ruled that Peabody should not be considered a public body for legal purposes in the circumstances of the case.

This meant the decision could not be challenged via judicial review and follows a 2010 High Court judgement, Weaver v L&Q, which found the opposite based on different circumstances.

Justice Davies based his decision on the fact that Peabody had not used any public subsidy or grants in purchasing the property in question. It also argued that there was no direct allocation relationship with any local authority and rents were not subject to any statutory social rent regulation.

The case means anyone seeking to bring a judicial review against housing associations must first demonstrate they are a public body.”

Homes exempt from 1% rent cut

The 1% annual rent cut will not apply to households with household income of £60,000 or more, the government has said.

The exemption was made in secondary legislation to the Welfare Reform and Work Act, which forces housing associations and councils to reduce their rents by 1% every year for four years.

According to Inside Housing:

“The Social Housing Rents (Exceptions and Miscellaneous Provisions) Regulations, published on Friday, state that the rent reduction will not apply to households meeting the income qualification criterion, which is £60,000.

Between 11,000 and 21,000 households living in social housing earn more than £60,000, according to government documents produced in 2013. This figure is an estimate based on the English Housing Survey however, and the true figure is difficult to capture.

As it stands, social landlords have no mechanism for forcing tenants to disclose their income details. However, there could be some help in the future from HMRC under measures in the Housing and Planning Bill.

Housing built through private finance initiatives (PFI) will also be exempt from the social rent cut.

Intermediate rent, temporary social housing, student accommodation and care homes are too exempt from the rent cut.

Supported housing will be exempt from the rent cut for one year, while the government carries out a review.

Full list of exemptions to 1% annual rent reduction

(a)accommodation where total household income meets the income qualification criterion [£60,000];

(b)in cases where sub-paragraph (a) does not apply, accommodation where total household income met the income qualification criterion in the previous relevant year;

(c)intermediate rent accommodation;

(d)specialised supported housing;

(e)PFI social housing;

(f)temporary social housing;

(g)student accommodation;

(h)accommodation where the rent registered under the Rent Act 1977 is lower than the social rent rate;

(i)in cases where sub-paragraph (h) does not apply, accommodation where the Rent Act 1977 rent criterion is met;

(j)care homes;

(k)relevant Housing Act 1996 accommodation;

(l)accommodation where the rent payable by the tenant was temporarily reduced or waived for any period during the previous relevant year.”

45,000 jobs to be created

Plans to train 45,000 new housebuilding workers in three years through a new £2.7m initiative were announced today.

A partnership between the Construction Industry Training Board (CITB) and Home Builders Federation (HBF) will seek to bring the housebuilding sector together to train the new staff.

The initiative, dubbed the Home Building Skills Partnership, will include the establishment of a framework that will set common standards for skills and training in the housebuilding sector.

The partnership, aims to support over 3,500 construction businesses and, by 2019, train 45,000 new entrants and 1,000 experienced workers with the new housebuilding training qualifications.

HCA watching asset register completion

A large number of housing associations are in danger of failing to meet 31st March 2016, deadline for completing a register of assets and liabilities.

A total of 49 out of 73 respondents to a survey by auditor RSM (formerly Baker Tilly) carried out in February said they had not yet completed their asset and liability registers. Under a new Homes and Communities Agency rule, all providers must certify that they have a complete register of assets and liabilities as of 31 March, in their 2015/16 accounts.

Gary Moreton, partner at RSM, said while it was still possible for landlords to complete their registers before the 31 March deadline, they had given themselves “really little time” and described the findings as “alarming”.

Mick Warner, deputy director of regulation at the HCA, said in June that the regulator could issue landlords with downgrades if they have made insufficient preparation for the registers.

The new requirement on landlords was introduced in the wake of the near collapse of Cosmopolitan Housing Group in 2012. Those involved in the rescue of Cosmopolitan faced weeks of delays while they determined exactly what assets and liabilities the group had, before the group was eventually taken over by Sanctuary.

A spokesperson for the regulator said it would be monitoring providers’ progress in establishing their registers and it would “take account of steps that have been taken to date”.

HCA reconsiders those who might be subect to indepth inspections

Mid-sized housing associations could be exempt from the English social housing regulator’s In-Depth Assessments, under a proposed shake-up of regulation.

Accoridng to Inside Housing:

“Proposals expected to be discussed by the Homes and Communities Agency (HCA) regulation committee later this year include removing the requirement on medium-sized landlords to undertake IDAs. This would allow the HCA to prioritise how it uses its regulatory resources.

From last year, all housing associations that own 1,000 homes have been subject to more stringent scrutiny through IDAs – detailed reviews of landlords’ businesses to ensure they comply with standards. Currently all housing associations owning 1,000 homes or more have to have an IDA.

Under the HCA’s proposals the regulatory regime would be more tailored to landlords’ individual risk, replacing the current blanket approach.

Medium-sized organisations would still be required to do annual stability checks and quarterly return data to the HCA under the proposals. Other suggestions being discussed include developing a simpler, cut-down version of the IDAs for medium-sized housing associations.

Housing associations that manage fewer properties and have smaller build programmes are generally thought by the HCA to pose less risk to the sector if they fail. It is understood associations with around 3,000 homes would fall into this category.

IDAs, which replaced less intensive annual viability reviews, were piloted by the HCA with 12 housing associations between February and August 2015 before being rolled out to all landlords last autumn.

In December, Fiona MacGregor, the HCA’s director of regulation, told MPs the regulator would look at removing the distinction between housing associations with more than 1,000 homes and those with fewer. However it is understood more regulation for associations with fewer than 1,000 properties is not part of the planned discussions.

The HCA would not confirm what its current budget is for regulation or whether it expects future budget decreases. Its budget for regulation in 2013/14 was £8.3m.

An HCA spokesperson confirmed it is reviewing its approach, but said no conclusions have yet been reached.

IN NUMBERS: HCA regulation

1,000 home threshold for IDAs
242 landlords with more than 1,000 homes (which respond to quarterly survey)
£8.3m regulation budget in 2013/14
3000 homes: approximate size of landlords which could be exempt from IDAs under new approach
£5.6bn cash balances of landlords owning more than 1,000 homes
£79.5bn total borrowing facilities of landlords owning more than 1,000 homes
Source: Homes and Communities Agency “

RTB funding shortage, might be plugged by developers

Councils could be forced to rely on private developers to replace high-value homes sold to fund the Right to Buy extension.

Baroness Susan Williams, parliamentary undersecretary at the Department for Communities and Local Government (DCLG), made the admission in a debate about the policy in the House of Lords.

Under the plans in the Housing and Planning Bill, councils will be forced to sell high-value homes to pay for housing association tenants’ Right to Buy discounts. The government has pledged money raised from sales will also be used to replace the council housing sold.

According to Inside Housing:

“Pressed over what would happen if a council was left with no funds to replace homes due to the demand for Right to Buy homes, Baroness Williams said: “My Lords, in that sort of situation, I would imagine that the local authority has a number of options available to it, including the use of capital reserves, or indeed borrowing if it wished to.

“Alternatively, of course, private sector developers could build housing.”

The comments are the latest indication there might not be enough funding from the sale of council housing to fund both Right to Buy discounts and replacement council homes.”

London announces 11 Housing Zones

City Hall has announced 11 new Housing Zones in London funded by an additional £200m of the mayor’s housing budget.

The announcement brings the total number of Housing Zones in London to 31, which are expected to deliver 77,000 new homes, 34% of which will be affordable.

Accorodng to Inside Housing:

The new zones, which will deliver a total of 24,554 new homes, include sites in Catford, Barking and Kingston.

The Housing Zones programme provides developers with planning certainty, as well as offering both capital grants and recoverable loans to provide a package of infrastructure to unlock the site.

City Hall hopes this allows the developer to build more housing, and more affordable housing, on the site as well as speeding up development.

Housing Zone  and Borough Total units
Bromley North Bromley 1,468
Kingston (Cambridge Estate Regeneration) Kingston 1,699
Canada Water Southwark 1,000
Old Kent Road Southwark 1,300
Catford Town Centre Lewisham 2,500
Barking Gateways Barking 1,902
Romford Havering 3,304
Edmonton Heartlands Enfield 3,254
Hayes Town Centre Hillingdon 2,788
Feltham Hounslow 3,339
High Road West Haringey 2,000
Boris Johnson, mayor of London, said: “Meeting the unprecedented demand for housing after 30 years of historic failure to build new homes is a critical issue affecting the capital.”

The developers and housing associations which will work on the zones are yet to be announced. The Housing Zone land is packaged up by local authorities before the status is awarded by City Hall.

Govt exploring ways to get social tenants to buy

The Government has announced it will look at ways of further increasing homeownership levels among social tenants.

The Budget document, said: “The government will explore ways to extend homeownership to social tenants who cannot afford to take advantage of existing schemes.” The document does not provide further details of what these schemes could consist of.

The announcement is one of several moves to boost homeownership outlined in today’s Budget. The Budget document says the government will also “explore options for encouraging private investment in low-cost home ownership”, including guarantees.

The government also announced it will publish a Starter Homes Land Fund prospectus today, inviting bids for £1.2bn of funding to remediate brownfield land to deliver the product. Starter Homes enable first-time buyers under 40 to buy a home with a 20% discount.

Garden City prospectus

Local authorities are being encouraged to apply to the government to build garden villages, towns and cities.

Local authorities are being encouraged to apply to the government to build garden villages, towns and cities.

A prospectus said “garden villages” would have between 1,500 and 10,000 homes whereas garden towns and cities would have more than 10,000 homes.

According to inside housing:

“Government support could include a “limited amount of funding” until 2018 and advice from the Homes and Communities Agency, the prospectus said.

This funding could come from existing schemes including the £2.3bn Starter Homes Fund, Help to Buy or other sources of government funding outside of housing schemes such as the free schools progamme.

The government is already backing developments at Ebbsfleet, Bicester, Basingstoke, Didcot, North Northamptonshire and North Essex.

The prospectus says there is not a “single template” for garden villages, towns and cities but adds the government will not support places “which merely use ‘garden’ as a convenient label”.

It adds: “We will want to see evidence of attractive, well-designed places with local support”.

The government is encouraging applications that propose to make use of brownfield land or public sector land.

Proposals that set out how land costs can be “minimised or land receipts “deferred” will be welcomed.

The developments will be expected to provide a proportion of Starter Homes as part of Section 106 agreements.

Off-site construction, self build and direct commissioning will also be encouraged.

Local authorities should make use of small and medium sized builders to help with the developments, the government said.

New garden towns and cities must have the support of county councils in two tier areas.

The government said a delivery vehicle in the form of a New Town Development Corporation could be set up for gardens towns and cities. It will be able to compulsorily purchase land and provide “long-term planning certainty that is likely to be attractive to private sector investors and landowners”, the government said.

The Budget also announced a number of measures to ‘streamline’ the planning system, including a move to a ‘red line approach’ where councils make more use of granting automatic planning permission in principle in order to give certainty to developers.”

 

 

 

Lenders pressurise fo changes in housing and planning bill

Ministers are set to change the Housing and Planning Bill following concerns that a new system of managing sector insolvencies would lead to lenders asking social landlords for more security.

Within weeks, the government is expected to table amendments to the proposed legislation, which is currently going through the House of Lords.

The bill would potentially damage lenders’ ability to realise the full value of their security on some loans.

The bill allows the communities secretary to appoint an administrator when a housing association collapses.