No compulsion on RSLs to offer equity shares

10 Feb 05
Housing associations will not be forced to offer tenants the opportunity to buy equity shares in their homes.

11 February 2005

Housing associations will not be forced to offer tenants the opportunity to buy equity shares in their homes.

Jon Rouse, chief executive of the Housing Corporation, said he hoped there would be a strong take-up of the government's Social Homebuy scheme among registered social landlords – but stressed that no pressure would be exerted by the corporation.

'The onus is on RSLs. The government has placed trust in them by making it voluntary,' he told Public Finance. 'My job is to make the scheme work. What happens if it doesn't take off isn't my concern.'

The corporation has until the end of this month to draw up a scheme to allow RSL tenants to purchase equity shares, prior to the expected launch of a government consultation document in late March.

Although Social Homebuy will be available to council and RSL tenants, it is likely to be more popular in the housing association sector, where fewer than half of tenants have the right to buy, or acquire, their homes.

Housing associations are likely to be encouraged to include equity share proposals in bids for development grants. According to Rouse, increased home ownership should be a feature of regeneration programmes.

The Office of the Deputy Prime Minister estimates that up to 300,000 council and housing association tenants will benefit from Social Homebuy, with about half ending up in full ownership. But only half of properties sold off will definitely be replaced.

Rouse pointed out that the ODPM is committed to building an extra 10,000 RSL homes per year, but said it was up to individual landlords to assess how the scheme could affect their stock.

'If they have social tenants with the ability to take on asset ownership, they should encourage it,' he said. 'We don't need these tenants to be taking social rented housing.'

The corporation, meanwhile, has promised more help for key workers in northern England, in towns such as Harrogate where house prices are out of the reach of most first-time buyers.

PFfeb2005

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