The repurchase scheme goes along with Portsmouh’s council house building programme where they are building 750 new council houses.
Our thanks to Cllrs Gerald Vernon Jackson, Darren Sanders and the Portsmouth Lib Dem team for this information.
The repurchase scheme goes along with Portsmouh’s council house building programme where they are building 750 new council houses.
Repurchase
Since the end of September 2016, Portsmouth City Council has been financing the repurchase of properties for re-incorporation into the housing stock. The number of repurchases to date is 443.
Gerald says: “It was an easy ask for me to get the Chief Finance Officer to borrow £100m to do this.”
Demand for affordable homes in Portsmouth is high and we are using buy backs to increase our social housing. As Liberal Democrats we are determined to take steps to provide genuinely affordable homes for people who need them.
Repurchases are driven from an understanding of housing need/demand. It is also about making full use of existing housing stock.
The sales agreed are for vacant possession but are subject to negotiation and contract. The purchase prices typically range between £70,000 and £300,000 depending on location and number of bedrooms.
Where does the funding come from?
- 40 per cent 1-4-1 Receipts
- 60 per cent Capital programme and borrowing
What properties are we repurchasing?
Most repurchases currently occur in blocks of flats as a result of the City Council's leaseholders selling their leasehold interest back to us.
We continue to repurchase ex-council houses (freehold) but have also repurchased a small number of non-Portsmouth City Council freehold houses.
There are clear benefits to bringing leasehold properties back into our stock:
- It is easier to deliver Planned Schemes of Works because of the removal of the S20 consultation process for leaseholders in a block.
- The properties are known to the council so it is unlikely there will be any defects/unknown structural issues with either the block or the property that we aren't aware of and cannot remedy.
- Any service charge arrears and reserve fund deficits are cleared at the point of completion.
- Reserve fund surpluses are reinvested back into the Capital programme.
There are clear benefits to bringing leasehold properties back into our stock:
- It is easier to deliver Planned Schemes of Works because of the removal of the S20 consultation process for leaseholders in a block.
- The properties are known to the council so it is unlikely there will be any defects/unknown structural issues with either the block or the property that we aren't aware of and cannot remedy.
- Any service charge arrears and reserve fund deficits are cleared at the point of completion.
- Reserve fund surpluses are reinvested back into the Capital programme.
For those interested, the detailed technical stages are:
- Initial enquiry
- Building survey and valuation
- Verbal offer and negotiation
- Financial appraisal and approval
- Formal offer of repurchase issued
- Legal instruction
- Legal documents reviewed and approved
- Land searches and title deeds
- Point of sale
- Completion
- Service charge and Reserve fund reconciliation
- Repurchase Handover
Progress
A total of 443 properties have been repurchased so far, and we are aiming to do more. Over the past 3 years this has meant more than double the amount of extra council properties available against those lost under Right to Buy.
Income
In the last financial year, a total of £3,776,194 was generated from the rental and service charges of these properties.