Housing Association flat that does not allow subletting?

Housing Association flat that does not allow subletting?

7:09 AM, 11th February 2022, About 3 months ago 4

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Hi, I have a young member of staff who purchased a flat in a housing association block of flats. He did not realise that when purchased, he could not sublet.

Has tried to sell his flat and the purchaser wants the right to sublet!

The other flats are all the housing association’s tenants! It seems unfair that being the only owner-occupier that the flat cannot be sublet?

I am aware that there are flats that are clearly only owner-occupiers, and I get that. However, the Housing Association has made it impossible for him to communicate with anyone due to various problems. Unable to have a meeting, etc.

Finally, their solicitor communicated with him and asked for a fee of £350 which they took and then told him that they had the advice to continue with this clause!!!

I am mystified and wonder whether there is anyone who can advise as to course of action?

Many thanks

David



Comments

by Ian Narbeth

9:56 AM, 11th February 2022, About 3 months ago

David
Are the HA tenants able to sublet? I expect the Association has a standard clause in their tenancies and they carried it over to the long lease.
You do not mention whether your colleague acquired from the HA or purchased an existing lease. He may be able to apply under s84 Law of Property Act 1925 to modify or discharge the covenant but only if the lease was granted for a term of more than 40 years and at least 25 years have passed since it was granted.
I suggest he takes legal advice. Even if the lease does not (presently) come within s84, the HA may be amenable to allowing subletting if contacted by a lawyer, albeit your colleague got the brush off from the HA's lawyers.

by Simon M

10:55 AM, 11th February 2022, About 3 months ago

The covenant suggests the HA or a pedecessor originally sold the flat following a Right to Buy or Right to Acquire. One intention of these schemes was to help tenants buy their own homes, but subsidized with taxpayer money and often against the HA's wishes. If these properties are subsequently let it undermines the original purpose so it's not surprising if there's resistence.

The estate agent will have known the flat is in a HA block and the purchaser's intention, so this should have been identified at the time of offer. Even if not, a landlord is a knowledgeable buyer and should have made enquiries before they made their offer. They may well be trying to pressure your colleague.

There's a strong market, so the quickest solution is to refuse the purchaser's demand. If they drop out, put it back on the market at a fair price and it will be snapped up. It's also worth approaching the HA who might be keen to buy it back - and you'd save the estate agent fees.

by Judith Wordsworth

12:02 PM, 11th February 2022, About 3 months ago

Why not approach the HA to buy back the property. They and local councils are desperate for properties

by Y Lana

14:18 PM, 11th February 2022, About 3 months ago

As has been said before on this forum, s/he needs to read the b**** lease – that’s what states what can and can’t be done.

I would also ask whether they own the property outright or is it shared ownership (in which you buy a percentage of the flat and rent the rest from the HA)? It is common for the latter to have clauses in the lease preventing/restricting sub-letting; the rationale being to avoid people buying them on the cheap and then renting them out for a profit. That said, HA’s can agree to sub-letting, depending on their policies and the circumstances of the lessee.

If the flat is owned outright and was bought as a resale on the open market, the lessee needs to read the lease and if there is a restrictive covenant, ask a lawyer to get the clause expunged - at a cost, of course.

OTOH, if the lessee bought directly from the HA under the right-to-buy/right-to-acquire schemes, I would direct them back to their solicitor that handled the transaction asking why the relevant clauses were not picked up/highlighted.


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