Cyclone Posted May 9, 2015 Share Posted May 9, 2015 ^^^^^^^^^^ This. How would private landlords react if the Tories were to force them to sell their properties off to their tenants at a huge discount? I suppose the devil is in the detail though. The tenant might get a discount, but that doesn't mean that the landlord or HA doesn't get the full market value. The difference being made up by the government... ---------- Post added 09-05-2015 at 16:01 ---------- The assets don't belong to them, they are a not for profit organization regulated and funded by government. Legally the assets do belong to them, as I'm sure you know. ---------- Post added 09-05-2015 at 16:01 ---------- If its theirs they would be able to sell it, they can't and even if they did they couldn't do as they wish with the proceeds. They loose nothing by allowing their tenants to buy them. A restrictive covenant doesn't alter the fact that they own it. Link to comment Share on other sites More sharing options...
loraward Posted May 9, 2015 Share Posted May 9, 2015 Your whole premise is utterly incorrect. HAs generally don't buy or build properties to sell them, apart from some shared ownership schemes that some of them run. They buy and build properties to rent them out. They generally don't sell them because it just isn't what they are set up to do. You know this so why make up a pretend argument that HAs have some kind of burning desire to sell off their assets at a loss and are being prevented from doing so. I didn't suggest they wanted to sell them and what makes you think selling them below market value would result in a loss. ---------- Post added 09-05-2015 at 16:11 ---------- Aside from the whole point of the company's existence you mean. They exist to provide affordable housing, how is selling them cheap not fulfilling that purpose? Link to comment Share on other sites More sharing options...
Berberis Posted May 9, 2015 Share Posted May 9, 2015 Wouldn't selling off the most expensive and then using the money to build more homes not benefit HA in the long run? Also I thought HA took these properties of the hands of the councils on the proviso they could be taken back if needed. Link to comment Share on other sites More sharing options...
I1L2T3 Posted May 9, 2015 Share Posted May 9, 2015 I didn't suggest they wanted to sell them and what makes you think selling them below market value would result in a loss. Given the size of the discounts it's a fair assumption that losses would be caused. Friend of mine is a senior manager at a HA and says this would devastate their business. A lot of the money they invest is borrowed commercially from the private sector over long timescales and they rely on rental income to service them. Redemption penalties on the loans are high as well. The government can't just order a private business to destroy itself by dictating an insane commercial plan to it. For HAs that are charitable there are even more protections. Link to comment Share on other sites More sharing options...
apelike Posted May 9, 2015 Share Posted May 9, 2015 Housing associations are largely charitable organisations. Under charity law charities are not allowed to dispose of assets at less than market value. Yes but the government do have the power to change or reform the charity laws, which to be honest is something well overdue. Link to comment Share on other sites More sharing options...
loraward Posted May 9, 2015 Share Posted May 9, 2015 Given the size of the discounts it's a fair assumption that losses would be caused. Friend of mine is a senior manager at a HA and says this would devastate their business. A lot of the money they invest is borrowed commercially from the private sector over long timescales and they rely on rental income to service them. Redemption penalties on the loans are high as well. The government can't just order a private business to destroy itself by dictating an insane commercial plan to it. For HAs that are charitable there are even more protections. The discounts takes years to build up, HA's will have made every penny back that the house cost to build and they are not allowed to make a profit. Its not as if they invested their own money, it was mostly tax payer money they used to build and most of the rent they get very likley comes from HB. Link to comment Share on other sites More sharing options...
Longcol Posted May 9, 2015 Share Posted May 9, 2015 Yes but the government do have the power to change or reform the charity laws, which to be honest is something well overdue. I agree that reform is overdue in some areas - however a law compelling charities to dispose of assets at below market value is so fundamental it is highly unlikely to garner much support. Link to comment Share on other sites More sharing options...
I1L2T3 Posted May 9, 2015 Share Posted May 9, 2015 The discounts takes years to build up, HA's will have made every penny back that the house cost to build and they are not allowed to make a profit. Its not as if they invested their own money, it was mostly tax payer money they used to build and most of the rent they get very likley comes from HB. Yes, but some people already have big discounts built up. Just a reminder to read my post properly - HAs are now getting finance from private sources too. As for any profit it has to be reinvested, that is not the same as not making a profit. Link to comment Share on other sites More sharing options...
alchemist Posted May 10, 2015 Share Posted May 10, 2015 ^^^^^^^^^^ This. How would private landlords react if the Tories were to force them to sell their properties off to their tenants at a huge discount? Perhaps they should, after all getting rid of any rented property does seem to be the ultimate aim of the tories Link to comment Share on other sites More sharing options...
El Cid Posted May 10, 2015 Share Posted May 10, 2015 One of the first things the Tories will try and do is repeal the Human Rights Act. They've been talking about doing it for years. If they succeed the basis of the legal challenge is gone. It is in the Conservative manifesto to replace it with a British human rights act, the Liberal Democrats stopped them doing it before. Link to comment Share on other sites More sharing options...
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