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Decision details

Equity Share

Decision Maker: Executive Councillor for Housing

Decision status: Recommendations Approved

Is Key decision?: Yes

Is subject to call in?: No

Purpose:

Approve a policy to offer housing under Equity Share

Decision:

Matter for Decision

The Equity Share policy is proposed as an addition to the City Council’s housing ‘offer’ at this time as it is a form of tenure that may be attractive to leaseholders of City Council flats that would be required to move under the Council’s new build housing programme.

 

Decision of Executive Councillor for Housing

 

The Executive Councillor resolved to:

 

(i)   Approve the Equity Share Policy attached as Appendix 1 of the officer’s report.

 

Reason for the Decision

As set out in the Officer’s report.

 

Any Alternative Options Considered and Rejected

Not applicable.

 

Scrutiny Considerations

The Committee received a report from the Head of Strategic Housing who highlighted the following errors in the figures noted under the ‘Financial implications’ (page 3 of the officer’s report):

 

(amendments in bold, errors struck through)

 

There is likely to be an additional capital cost to the Council as any move facilitated under the Equity Share policy is likely to result in the resident moving to a property of a higher value. This capital cost will be recovered at the end of the lease or when the resident chooses to move in the future. Any capital cost will be considered as part of the project approval for the specific Council new build scheme.

 

The following is an example of the financial impact of an Equity Share move.

 

Assumptions;

 

Resident moves from one bedroom one person flat to one bedroom two person flat.

 

 

Value of current flat - £100,000

Value of new flat - £150,000

 

Home Loss Payment – £100,000 (current flat value) plus £10,000 (10% of current value) less £4,700 (compensation equivalent to tenant) = £105,300 £115,300.

 

Capital outlay by Council on new flat (the Council’s equity) - £150,000 (value of new flat) less £105,300 £115,300 (the resident’s equity) = £44,700 £34,700.

 

In this example the resident has an 70.2% 77% equity share in the new flat.

 

 

The Committee made the following comments in response to the report:

 

(i)             Felt that is should be made clearer that Equity Share was also available to non-resident leaseholders.

 

Councillor Price read out a statement of behalf of a resident of Aylesborough Close. The Director of Customer and Community Services confirmed that the Council were in discussions with the resident to address the issues, and the Head of Strategic Housing agreed to write a formal response and copy Councillor Price in. 

 

The Committee resolved (by 4 votes to 0) to endorse the recommendations.

 

The Executive Councillor approved the recommendation.

 

Conflicts of Interest Declared by the Executive Councillor (and any Dispensations Granted)

No conflicts of interest were declared by the Executive Councillor.

 

Publication date: 21/08/2013

Date of decision: 25/06/2013