Overview
- In 2015 Accent Housing Foundation decided to dispose of some of its vacant street properties in North Ormesby, since they were seen as hard to re-let and expensive to maintain
- With the backing of North Ormesby Development Trust, a Community Land Trust was formed to manage the properties. With financial support from North Ormesby Big Local, it was resolved to approach Accent to acquire six properties to keep them in social ownership
- The open market value of the properties was around £25,000, but a discounted sale price of around £13,000 per property was agreed, which would be funded by a grant from Big Local
- Accent was able to sell the properties for less than market value following agreement with the HCA (now Homes England)
- It became apparent that the cost of acquisition and refurbishing the properties, largely as a result of damage sustained while vacant, was greater than the £150,000 funding available via Big Local
- A deal was then struck with Thirteen Housing Group to use HCA Empty Homes funding (Lease & Repair) to finance the refurbishment of all six properties
- As a result the properties will be leased to Thirteen for 5 years at a peppercorn rent to enable them to claim the HCA grant. Following their refurbishment ( at around £24,500 per property) Thirteen will then lease them back to the Development Trust for five years on the same basis. At the end of the five year lease the properties revert to the Trust as the freeholder
Key Messages
- It’s possible for a locally based organisation to bring back into use properties that have been written off by housing associations as unlettable and uneconomic
- Accent’s decision to sell at less than market value was crucial to this deal going through and was partly based on a judgement that a local organisation could better manage the properties and that this might have a knock on effect in terms of improving the area, which in turn would help them with managing their other properties in North Ormesby
- Their refurbishment provides an opportunity to create training and employment opportunities, involving local labour. In this case, another CLH organisation, Community Campus, is working with its trainees on refurbishing the properties
- For a locally based CLH organisation to be able to take over these responsibilities, they need to own the assets in order to secure a long term revenue stream
- Ownership of assets can make it possible to secure further funding to acquire further properties to rehouse people from the local community. A further £48,000 has been allocated by North Ormesby Big Local to try to purchase more properties
More information on this CLH project is here.
Published in March 2018
