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On 28 May 2021 Homes England published new model leases that apply to shared ownership developments that are delivered through Homes England’s Affordable Homes Programme 2021 to 2026 (AHP 2021-2026).
Providers of shared ownership housing need to be aware of the requirements of AHP 2021-2026 and the provisions in the model leases.
The new shared ownership model applies to all shared ownership homes delivered through AHP 2021-2026, including Home Ownership for People with Long-Term Disabilities (HOLD), Older Persons Shared Ownership (OPSO), homes in rural protected areas and homes purchased through the Right to Shared Ownership.
The new model also applies to new Shared Ownership homes funded from 1 April 2021 using receipts from the Voluntary Right to Buy programme.
The major changes proposed to the shared ownership model from 1st April 2021 are:
The provider will be able to choose to offer the AHP 2021-2026 lease to those homes provided through the Shared Ownership and Affordable Homes Programme 2016 to 2021 (SOAHP 2016-2021) and which will complete and be sold after 1 April 2021. Providers will need to consider their options for such sites.
Fundamental clauses are those which cannot be altered without the consent of Homes England. For both SOAHP 2016-2021 and AHP 2021-2026 Shared Ownership homes the following fundamental clauses apply:
However, new Shared Ownership homes provided through AHP 2021-2026 from 1 April 2021 have the same fundamental clauses as the SOAHP 2016 to 2021 programme with the following amendments / additions:
The AHP 2021-2026 lease now also contains two stamp duty certificates to enable the purchaser’s solicitor to select whether the shared owner has elected to pay stamp duty either on the value of the initial share or if they have elected to pay on the full market value.
For shared ownership homes provided through the AHP 2021-2026, there is a separate key information document pack to be completed and presented by providers for the sale of new Shared Ownership homes. It is a condition of grant funding that these documents are completed and provided to the customer no later than at reservation stage. The completed documents should be sent to the buyer’s solicitor along with the memorandum of sale. Providers should obtain confirmation from the buyer’s solicitor that these have been provided to the customer.
TLT has a dedicated Housing and Regeneration team with experience of all types of shared ownership. Please get in touch to find out how we can help you.
Contributor: Matt Battensby
This publication is intended for general guidance and represents our understanding of the relevant law and practice as at June 2021. Specific advice should be sought for specific cases. For more information see our terms & conditions
15 June 2021