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Changes over time for: Cross Heading: Disposals by registered social landlords

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Housing Act 2004, Cross Heading: Disposals by registered social landlords is up to date with all changes known to be in force on or before 28 March 2024. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations. Help about Changes to Legislation

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  • Act savings and transitional provisions for amendments by S.I. 2022/1166 by S.I. 2022/1172 Regulations

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Disposals by registered social landlordsE+W

199Repayment of discount: periods and amounts payableE+W

(1)For section 11 of the Housing Act 1996 (c. 52) substitute—

11Covenant for repayment of discount on disposal

(1)Where on a disposal of a house by a registered social landlord, in accordance with a consent given by the Relevant Authority under section 9, a discount has been given to the purchaser, and the consent does not provide otherwise, the conveyance, grant or assignment shall contain a covenant binding on the purchaser and his successors in title to the following effect.

(2)The covenant shall be to pay to the landlord such sum (if any) as the landlord may demand in accordance with subsection (3) on the occasion of the first relevant disposal which is not an exempted disposal and which takes place within the period of five years beginning with the conveyance, grant or assignment.

(3)The landlord may demand such sum as he considers appropriate, up to and including the maximum amount specified in this section.

(4)The maximum amount which may be demanded by the landlord is a percentage of the price or premium paid for the first relevant disposal which is equal to the percentage discount given to the purchaser in respect of the disposal of the house by the landlord.

(5)But for each complete year which has elapsed after the conveyance, grant or assignment and before the first relevant disposal the maximum amount which may be demanded by the landlord is reduced by one-fifth.

(6)Subsections (3) to (5) are subject to section 11A.

11AIncrease in value of house attributable to home improvements to be disregarded

(1)In calculating the maximum amount which may be demanded by the landlord under section 11, such amount (if any) of the price or premium paid for the first relevant disposal which is attributable to improvements made to the house—

(a)by the person by whom the disposal is, or is to be, made, and

(b)after the conveyance, grant or assignment and before the disposal,

shall be disregarded.

(2)The amount to be disregarded under this section shall be such amount as may be agreed between the parties or determined by the district valuer.

(3)The district valuer shall not be required by virtue of this section to make a determination for the purposes of this section unless—

(a)it is reasonably practicable for him to do so; and

(b)his reasonable costs in making the determination are paid by the person by whom the disposal is, or is to be, made.

(4)If the district valuer does not make a determination for the purposes of this section (and in default of an agreement), no amount is required to be disregarded under this section.

11BLiability to repay is a charge on the house

(1)The liability that may arise under the covenant required by section 11 is a charge on the house, taking effect as if it had been created by deed expressed to be by way of legal mortgage.

(2)Where there is a relevant disposal which is an exempted disposal by virtue of section 15(4)(d) or (e) (compulsory disposal or disposal of yard, garden, etc.)—

(a)the covenant required by section 11 is not binding on the person to whom the disposal is made or any successor in title of his, and

(b)the covenant and the charge taking effect by virtue of this section cease to apply in relation to the property disposed of.

(2)In section 12, for “section 11” in each place where it occurs substitute “ section 11B ”.

(3)The amendments made by this section do not apply in any case where—

(a)the purchaser has accepted an offer for the disposal of the house from the landlord, or

(b)the landlord has accepted an offer for the disposal of the house from the purchaser,

before the day on which this section comes into force.

(4)Subsection (5), however, applies in any such case if the first relevant disposal by the purchaser to which the covenant for repayment of discount applies takes place on or after the day on which this section comes into force.

(5)In the following provisions—

(a)section 11(2) of the Housing Act 1996 (c. 52) (as it has effect without the amendments made by this section), and

(b)any covenant for repayment of discount,

any reference (however expressed) to a person being liable to pay an amount to the landlord on demand is to be read as a reference to his being liable to pay to the landlord so much of that amount (if any) as the landlord may demand.

(6)In subsections (4) and (5) “covenant for repayment of discount” means the covenant contained in a conveyance, grant or assignment in accordance with section 11 of that Act.

200Registered social landlord’s right of first refusalE+W

(1)After section 12 of the Housing Act 1996 insert—

12ARight of first refusal for registered social landlord

(1)Where on a disposal of a house by a registered social landlord, in accordance with a consent given by the Relevant Authority under section 9, a discount has been given to the purchaser, and the consent does not provide otherwise, the conveyance, grant or assignment shall contain the following covenant, which shall be binding on the purchaser and his successors in title.

(2)The covenant shall be to the effect that, until the end of the period of ten years beginning with the conveyance, grant or assignment, there will be no relevant disposal which is not an exempted disposal, unless the prescribed conditions have been satisfied in relation to that or a previous such disposal.

(3)In subsection (2) “the prescribed conditions” means such conditions as are prescribed by regulations under this section at the time when the conveyance, grant or assignment is made.

(4)The Secretary of State may by regulations prescribe such conditions as he considers appropriate for and in connection with conferring on—

(a)a registered social landlord which has made a disposal as mentioned in subsection (1), or

(b)such other person as is determined in accordance with the regulations,

a right of first refusal to have a disposal within subsection (5) made to him for such consideration as is mentioned in section 12B.

(5)The disposals within this subsection are—

(a)a reconveyance or conveyance of the house; and

(b)a surrender or assignment of the lease.

(6)Regulations under this section may, in particular, make provision—

(a)for the purchaser to offer to make such a disposal to such person or persons as may be prescribed;

(b)for a prescribed recipient of such an offer to be able either to accept the offer or to nominate some other person as the person by whom the offer may be accepted;

(c)for the person who may be so nominated to be either a person of a prescribed description or a person whom the prescribed recipient considers, having regard to any prescribed matters, to be a more appropriate person to accept the offer;

(d)for a prescribed recipient making such a nomination to give a notification of the nomination to the person nominated, the purchaser and any other prescribed person;

(e)for authorising a nominated person to accept the offer and for determining which acceptance is to be effective where the offer is accepted by more than one person;

(f)for the period within which the offer may be accepted or within which any other prescribed step is to be, or may be, taken;

(g)for the circumstances in which the right of first refusal lapses (whether following the service of a notice to complete or otherwise) with the result that the purchaser is able to make a disposal on the open market;

(h)for the manner in which any offer, acceptance or notification is to be communicated.

(7)In subsection (6) any reference to the purchaser is a reference to the purchaser or his successor in title.

Nothing in that subsection affects the generality of subsection (4).

(8)Regulations under this section—

(a)may make different provision with respect to different cases or descriptions of case; and

(b)shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

(9)The limitation imposed by a covenant within subsection (2) is a local land charge.

(10)The Chief Land Registrar must enter in the register of title a restriction reflecting the limitation imposed by any such covenant.

(11)Where there is a relevant disposal which is an exempted disposal by virtue of section 15(4)(d) or (e) (compulsory disposal or disposal of yard, garden, &c)—

(a)the covenant required by this section is not binding on the person to whom the disposal is made or any successor in title of his, and

(b)the covenant ceases to apply in relation to the property disposed of.

12BConsideration payable for disposal under section 12A

(1)The consideration for a disposal made in respect of a right of first refusal as mentioned in section 12A(4) shall be such amount as may be agreed between the parties, or determined by the district valuer, as being the amount which is to be taken to be the value of the house at the time when the offer is made (as determined in accordance with regulations under that section).

(2)That value shall be taken to be the price which, at that time, the interest to be reconveyed, conveyed, surrendered or assigned would realise if sold on the open market by a willing vendor, on the assumption that any liability under the covenant required by section 11 (repayment of discount on early disposal) would be discharged by the vendor.

(3)If the offer is accepted in accordance with regulations under section 12A, no payment shall be required in pursuance of any such covenant as is mentioned in subsection (2), but the consideration shall be reduced, subject to subsection (4), by such amount (if any) as, on a disposal made at the time the offer was made, being a relevant disposal which is not an exempted disposal, would fall to be paid under that covenant.

(4)Where there is a charge on the house having priority over the charge to secure payment of the sum due under the covenant mentioned in subsection (2), the consideration shall not be reduced under subsection (3) below the amount necessary to discharge the outstanding sum secured by the first-mentioned charge at the date of the offer (as determined in accordance with regulations under section 12A).

(2)In section 13(1) of the Housing Act 1996 (c. 52) (restriction on disposal of houses in National Parks, &c), after “restriction on assignment)” insert “ or a covenant as mentioned in section 12A(2) of this Act (right of first refusal for registered social landlord) ”.

(3)The amendments made by this section do not apply in relation to a disposal under section 8 of that Act if—

(a)the purchaser has accepted an offer for the disposal of the house from the landlord, or

(b)the landlord has accepted an offer for the disposal of the house from the purchaser,

before the day on which this section comes into force.

Commencement Information

I1S. 200 wholly in force at 18.1.2005; s. 200 in force for certain purposes at Royal Assent and in force otherwise at 18.1.2005, see s. 270(2)(b)(3)(a)

201Deferred resale agreementsE+W

(1)After section 15 of the Housing Act 1996 insert—

15ATreatment of deferred resale agreements for purposes of section 11

(1)If a purchaser or his successor in title enters into an agreement within subsection (3), any liability arising under the covenant required by section 11 shall be determined as if a relevant disposal which is not an exempted disposal had occurred at the appropriate time.

(2)In subsection (1) “the appropriate time” means—

(a)the time when the agreement is entered into, or

(b)if it was made before the beginning of the discount repayment period, immediately after the beginning of that period.

(3)An agreement is within this subsection if it is an agreement between the purchaser or his successor in title and any other person—

(a)which is made (expressly or impliedly) in contemplation of, or in connection with, a disposal to be made, or made, by virtue of section 8,

(b)which is made before the end of the discount repayment period, and

(c)under which a relevant disposal which is not an exempted disposal is or may be required to be made to any person after the end of that period.

(4)Such an agreement is within subsection (3)—

(a)whether or not the date on which the relevant disposal is to take place is specified in the agreement, and

(b)whether or not any requirement to make that disposal is or may be made subject to the fulfilment of any condition.

(5)The Secretary of State may by order provide—

(a)for subsection (1) to apply to agreements of any description specified in the order in addition to those within subsection (3);

(b)for subsection (1) not to apply to agreements of any description so specified to which it would otherwise apply.

(6)An order under subsection (5)—

(a)may make different provision with respect to different cases or descriptions of case; and

(b)shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

(7)In this section—

  • agreement” includes arrangement;

  • the discount repayment period” means the period of three or five years that applies for the purposes of section 11(2) (depending on whether an offer such as is mentioned in section 199(3) of the Housing Act 2004 was made before or on or after the coming into force of that section).

(2)The amendment made by this section does not apply in relation to any agreement or arrangement made before the day on which this section comes into force.

Commencement Information

I2S. 201 wholly in force at 18.1.2005; s. 201 in force for certain purposes at Royal Assent and in force otherwise at 18.1.2005, see s. 270(2)(b)(3)(a)

F1202Right of assured tenant to acquire dwelling not affected by collective enfranchisementE+W

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