12 Jun 2009

AONB Covenant proposed change?

Currently there exists a covenant that the District Council uses in the sales of its properties in the Cotswold Area of Outstanding Natural Beauty to restrict the persons to whom such properties can be transferred on subsequent sales off. There are planned changes to which I am opposing.

The specific criteria of the covenant are set out in section 157 of the Housing Act 1985 but there follows a prĂ©cis of the Council’s policy as regards such properties :

Where the criteria are met – in the Council’s case, where the applicant has lived and/or worked in Gloucestershire (NB. This does not include South Gloucestershire) for the three years prior to the application for consent, or has worked or lived in another A.O.N.B. or National Park – consent cannot be withheld, and is given by the Head of Housing Standards under delegated authority. If the proposed purchaser has not lived or worked in Gloucestershire for two years prior to the application for approval, consent will be automatically denied. Where the applicant has lived or worked in the county for between two and three years, the matter will be considered by the Head of Housing Standards under delegated authority. Where there is more than one purchaser, only one has to meet the criteria.
The Council has apparently recently received an increasing number of applications for consent where the applicants do not meet the criteria and given the economic climate it proposes to review its policy in relation to the AONB covenant. As part of this review the Council is consulting with local agencies. Here is what I think...

On the basis of the evidence available to me I would strongly note that the policy should remain: ex-social housing is more affordable and in villages where we do not have much social housing it at least puts a preference for local people.

I understand that there is a desire to keep the housing market alive but I am disappointed that such a proposal should come forward with no real evidence in favour of a change. Does the current policy mean that properties are sometimes cheaper as there is less competition for the sale of those properties? Does it reduce second-home ownership? I would welcome more information as to how the current policy operates, how many houses this entails, how often the policy is overturned under the delegated authority, whether there has been follow-up research on homes sold and even for example, if there are ways the policy could be more strictly followed rather than less?

The lack of affordable housing in many villages is a serious problem and we need to be doing much more to address this issue. This policy is one very small part of what is needed although I suspect it has only a marginal effect. However in my view, having not seen evidence to the contrary, it is part of the limited ways we can try to address more fairly the housing needs of local people.

Cllr. Philip Booth


Anonymous said...

Currently the problem is that mortgage lenders will not lend on properties that have a local occupancy order on them. They used to lend but recently lending critera have become much tighter and a local occupancy order is seen as a restriction to sale. This means local first time buyers can not get a mortgage for these properties and the only people who can buy them are wealthy locals who then rent them out.

The local occupancy policy is well meaning but is having the effect of making it even more difficult for local people on lower incomes to buy houses. A local mortgage advisor infomed me that it is even a problem for people trying to get a mortgage for shared occupancy schemes when the houses are under local occupancy orders.

The mortgage markets has radically changed and council policy has not kept pace with this. I recommed you stop advocating the creation of tigher policies from the comfort of the home you, nodoubt, own and find out what it is like to be a young professional or familiy in one of these areas who is unable to buy property simply because of the of the local occupancy order scheme.

Philip Booth said...

Thanks for comment - this is not about recommending tighter policies but about reviewing existing policies and possible loosening them - as you may know it is up for discussion by Cabinet this Thursday.

SDC has consulted many different people incl a local valuer since the recent problems and my understanding is that mortgages are not refused and haven't been - if you have evidence otherwise then I would welcome seeing it.

In 2008/9 19 applications were approved and 2 applications refused.

In the current economic climate it is difficult to obtain a mortgage and sell property with or without a covenant.

Clearly a covenant is not a perfect way of supporting local people but it is one of only a very few ways that we can act. One option being discussed is to modify the employment/residency criteria to allow more local people who have connections or work to purshase.

However as noted before the covenant by all accounts is a limited but an effective way to make sure homes are available for local people who can afford them.