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Affordable Housing Gateway: Revision of Deferred Payment Sales Process: Approval

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Ministers are elected by the States Assembly and have legal responsibilities and powers as “corporation sole” under the States of Jersey Law 2005 by virtue of their office and in their areas of responsibility, including entering into agreements, and under any legislation conferring on them powers.

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A decision made 4 July 2013:

Decision Reference:  MD-TR-2013-0051

Decision Summary Title:

Revision of Deferred Payment Sales Process

Date of Decision Summary:

26th June 2013

Decision Summary Author:

Projects Director

Decision Summary:

Public or Exempt?

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

N/A

Written Report

Title:

Revision of Deferred Payment Sales Process

Date of Written Report:

26th June 2013

Written Report Author:

Projects Director

Written Report :

Public or Exempt?

Public

Subject: - Sale of properties : deferred payment - change to process

Decision(s):

The Minister agreed to approve the changes to the process for the sale of properties where a deferred payment is provided to purchasers, as requested in Housing MD-H-2013-0043.

 

Reason(s) for decision:

To ensure that the homes for sale with a deferred payment are available to appropriate applicants who would not be able to purchase a home unassisted and that income arising from sales is reinvested in the social housing stock.

 

Resource Implications:

None.

 

Action required: Projects Director to advise Housing Finance Director that the Minister has approved the change.

 

Signature:

 

 

Position: Senator P.F.C. Ozouf, Minister for Treasury and Resources

 

Date Signed:

 

Date of Decision:

Hide report
Affordable Housing Gateway: Revision of Deferred Payment Sales Process: Approval

 - 1 -

Treasury and Resources

Ministerial Decision Report

 

 

 

Revision of Deferred Payment sales Process

 

 

  1. Purpose of Report

The Minister for Treasury and Resources is requested to approve the decision taken by the Housing Minister, to change the process for the sale of properties, where a deferred payment is provided to purchasers.

 

  1. Background

The Housing Minister in MD-H-2013-0043 agreed the following:-

  1. that deferred payment sales should continue at an average rate of 15 sales per annum, as a means of providing continued funding for the refurbishment and new build programme and as a means of continuing to realign the stock. 
  2. that homes may be sold to anyone (other than existing or previous home owners) registered with the Affordable Housing Gateway irrespective of whether or not they are an existing social housing tenant. 
  3. that the existing maximum 25% deferred payment continues to be made available on a means tested basis according to the particular circumstances of the buyer(s).
  4. that all sales continue to be passed for approval to the Minister for Treasury & Resources in accordance with Standing Order 168.
  5. that all properties sold be retained within the Affordable Housing market by contractual provisions which restrict onward sales to Affordable Housing Gateway qualifiers or other such restriction introduced by the Minister through the auspices of the Strategic Housing Unit.
  6. that the income from all sales continues to be applied to the Housing Department’s rolling vote HYR000 for use in refurbishing the stock or in developing new homes.
  7. the contents of Policy HD20 and HD42.
  8. to seek the approval of the Minister for Treasury & Resources to the change in Policy.

 

The key reasons identified by Housing, in their report, to support the changes approved are:-

 

  1. The introduction of the Affordable Housing Gateway now provides a means of identifying a wider pool of those in housing need and it is clear that there is a significant latent demand for the purchase of an affordable home.  It is also clear that those registered within Band 5 (the Band reserved for those wishing to purchase with assistance) on the Gateway are not in a position to purchase an appropriate home on the open market without assistance.

 

 

  1. Widening sales to this group has a number of advantages:-

 

  1. It provides a realistic means of purchasing for many families who otherwise could not become home owners.

 

  1. It is more equitable.

 

  1. It promotes the use of the Gateway for affordable purchase schemes and may as a consequence encourage more applications giving a more accurate reflection of needs.

 

  1. Until the Strategic Housing Unit has completed its Housing Strategy and introduced other affordable or intermediate housing products the existing deferred payment scheme offers a useful mechanism for a limited number of qualifying purchasers to buy.

 

  1. The existing deferred payment scheme is well established and understood by local lenders and legal practices.

 

  1. The approvals process as set out in States Standing Order 168 is well established.

 

  1. Widening the pool of potential buyers makes achieving sales targets more realistic.

 

  1. Reinvestment in the stock can continue which as a consequence helps to support the construction industry.

 

  1. The strategic realignment of the stock can continue.

 

  1. Applicants will continue to be means tested in line with Policy HD42 “Calculating deferred payment entitlement for affordable housing sales” attached hereto.

 

  1. Allocations will continue to be prioritised within the spirit of existing policy HD20 “Allocation policy for the sales of affordable homes”.

 

  1. Recommendation

It is recommended the Minister approve the decision made by the Housing Minister in MD-H- 2013-0043

 

  1. Resource Implications

There are no financial or manpower implications arising from this decision.

 

 

Report author : Projects Director

Document date : 26th June 2013

Quality Assurance / Review : Business Manager

File name and path: \L:\Treasury\Sections\Corporate Finance\Ministerial Decisions\DSs, WRs and SDs\2013-0052 - Central Contingency Funding for Financial services review - McKinsey\WR - Rev. of Def. Pay. Sales Process - JS.doc

MD sponsor :

 

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