Source · Select Committees · Housing, Communities and Local Government Committee
Recommendation 7
7
Accepted in Part
Paragraph: 58
Mandate OPSO providers highlight legacy service charge costs to prospective owners and families.
Recommendation
The Government must make it mandatory for providers of OPSO to highlight the potential legacy costs of service charges being passed on to family members to prospective shared owners and family members in line to inherit the property upon the shared owner’s death, prior to initial purchase. Homes England could ensure this by specifying the need to include this information in the Key Information Documents. The Government should also give consideration to how it can encourage providers to better support those inheriting OPSO properties to sell the property upon the death of their relative.
Government Response Summary
The government commits to amending OPSO key information documents to highlight potential legacy costs to beneficiaries and will consider mandating providers to include this information. For supporting heirs with sales, it outlines existing options available to providers but states providers must decide how best to support.
Paragraph Reference:
58
Government Response
Accepted in Part
HM Government
Accepted in Part
19. The Government and Homes England will amend the OPSO key information documents to make it clear to potential buyers that the financial liabilities associated with their home may be passed on to their beneficiaries if they inherit the lease. We will also consider mandating registered providers of OPSO homes to include this information on their websites and in other relevant literature as a condition of government-grant funding. 20. More broadly, the Government always encourages people to seek independent financial and legal advice prior to the completion of any home ownership purchase, including those for shared ownership. This offers buyers the opportunity to discuss their financial liabilities under the terms of the lease, as well as what will happen to these liabilities if the lease is inherited by a beneficiary. As this is common to all forms of property inheritance, it is something that should be considered by all buyers, and not just those who are intending to purchase an OPSO home. 21. T he Government and Homes England are responsible for setting out the framework for how all forms of shared ownership should operate. This includes offering registered providers a set of options for how they can support shared owners, including those who have purchased OPSO homes, with the sale of their home. 22. T his includes an eight-to-four-week pre-emption period, where registered providers can find a nominated purchaser or take surrender of the lease. It also includes the possibility of registered providers using a financial resource known as a Recycled Capital Grant Fund to repurchase OPSO leases. This latter option is available at registered providers’ discretion, and they would need to take account of their wider financial position before exercising it. 23. Beyond this, registered providers must decide how best to support the sale of OPSO homes. We expect registered providers to offer general support with the marketing of homes and the identification of potential buyers, and we know that many do offer this support, as and when required.