Shared Ownership Policy

1.1 Dover District Council (“the Council”) is committed to providing a range of affordable housing options that meet both the housing needs and aspirations of residents in the district of Dover.

1.2 Shared Ownership is an affordable housing product where shares are purchased in a new home, and a regulated rent is paid on the unsold equity to the freeholder as determined by a legally binding lease arrangement. The scheme is designed to support householders benefiting from the stability of home ownership without having to meet the deposit and borrowing requirements of purchasing the property, and whose needs are not currently met by the open market.

1.3 In 2020 the Government announced the new Shared Ownership and Affordable Homes Programme (SOAHP) 2021-2026 to replace the SOAHP 2016-2021 programme. As part of the new scheme, the shared ownership model was changed to make it more affordable for first time buyers. We therefore recognise the importance of maintaining a shared ownership policy that reflects both current legislation and regulatory requirements as well as local housing priorities.

1.4 References made in this Policy to the Capital Funding Guide are in the form that it is currently published at the date of this Policy.

2.1 For the purposes of this policy: ‘We’, ‘our’ and ‘us’ refers to Dover District Council.

‘The property’ refers to a shared ownership property owned by the Council that is for sale or resale, already leased or in the process of staircasing, downward staircasing and repossession, and including any outside areas that form part of the property such as gardens, patios, and balconies.

‘Applicant’ refers to the individual or individuals who have or will be applying to purchase a shared ownership property sold by DDC.

‘Buyer’ refers to the individual or individuals who have reserved a shared ownership property sold by DDC and have received a ‘Memorandum of Sale’ confirming the sale to them.

‘Advisor’ refers to a mortgage broker or financial advisor who is suitably qualified, experienced and regulated to provide financial advice on affordability and mortgages (Capital Funding Guide, Section 1, subsection 6.3).

‘Agreement in Principle (AIP), also known as a ‘Decision in Principle’ or a ‘Mortgage in Principle’ refers to a certificate or statement from a lender to confirm that ‘in principle’ they would lend a loan amount to borrowers to purchase a property.

‘District’ refers to the district of Dover.

‘Lease agreement’ or ‘lease’ refers to the legally binding contract between the freeholder and the Shared owner that sets out responsibilities and obligations of either party for the duration of the term of the lease.

‘Freeholder’ refers to the person or organisation who owns the freehold to a piece of land or property. DDC is the freeholder for all leasehold properties related to this document.

‘Shared owner’ refers to the individual or individuals who have completed their purchase of a shared ownership property owned by the Council and have signed a lease agreement.

‘Valuer’ or ‘surveyor’ refers to an independent expert who is an associate or fellow of the Royal Institution of Charter Surveyors (RICS) who conducts the valuation of the shared ownership property at the sale, resale, staircasing and downward staircasing stages.

‘Initial sale’ refers to the very first sale of a Shared Ownership property.

‘Grant-funded’ refers to shared ownership properties which have been fully or partially developed with grant funds through the Shared Ownership and Affordable Homes Programme (SOAHP) 2016-2021 and Affordable Homes Programme (AHP) 2021- 2026.

‘Non-grant funded’ refers to shared ownership properties that have not been developed with Homes England grant funding either through the Shared Ownership and Affordable Homes Programme (SOAHP) 2016-2021 or the Affordable Homes Programme (AHP) 2021-2026. These are usually properties developed as part of an affordable housing Planning Requirement (also known as section 106 properties).

‘New model’ refers to shared ownership properties that have been built under the Affordable Homes Programme (AHP) 2021-2026. ‘Old model’ refers to shared ownership properties that have been built under the Shared Ownership and Affordable Homes Programme 2021-2026

3.1 This policy has been written from the Council’s perspective as a landlord and the freeholder, and refers to:

• both models of shared ownership; and
• shared ownership properties which have been constructed with or without an element of Homes England funding.

3.2 The Policy sets out clear guidance for Council staff, current shared owners and prospective applicants regarding our approach to initial sales, resales, staircasing and remortgaging, for properties owned, leased, and sold by the Council under the Shared Ownership scheme. It does not refer to any other shared ownership properties owned, leased, or sold by Registered Providers (Housing Associations) or housing developers.

3.3 For post-sale management of shared ownership properties, please refer to our Leasehold Management Policy

4.1 The main objective of this policy is to ensure that shared ownership properties are sold in a fair way that is consistent and compliant with legislative and regulatory requirements and Homes England funding criteria. The Policy will also outline DDC's position regarding:

• what the marketing and sales process is in relation to shared ownership properties; and
• the difference between 'new' and 'old' model shared ownership products; and
• what monies are payable under the terms of the lease and what support, advice and information is available; and
• purchasing additional shares in shared ownership properties and DDC's position on 'downward staircasing', repurchases and resales.

4.2 This policy should be read in conjunction with the requirements of the Homes England Capital Funding Guide (opens in new tab) and the Leasehold Management Policy.

5.1 The Council will comply with all applicable legislation, statutory guidance and regulatory standards governing shared ownership, and that our shared ownership practices are lawful, transparent and aligned with both national frameworks and local policy objectives.

5.2 This Policy has been developed in recognition of the Council’s statutory obligations and its wider responsibilities under relevant corporate strategies and internal policies. It aligns with the following documents and guides:

Internal documents:

• Leasehold Management Policy

• Corporate Plan 2023-2027 (opens in new tab)

• Complaints Policy

• Equality Policy

Guidance:

• Capital Funding Guide

• Shared ownership homes: buying, improving and selling

6.1 There are two models of shared ownership, referred to as ‘old’ and ‘new’ models, each with differing features. The Government’s intention for the new model of shared ownership is for it to be fairer, more affordable and consumer friendly.

6.2 The table below highlights the key features and differences between the two models.

6.3 Since there is an overlap between both the SOAHP and AHP funds, some shared ownership properties sold by the Council may be either old or new model. Applicants and leaseholders will be made aware of the type of model they are purchasing by their appointed solicitor, and via our advertisements. Details may also be contained within the individual lease agreements

Marketing and communication

7.1 We will employ a range of marketing approaches to ensure that residents are aware of schemes in the district, including how to apply. This may involve advance promotion of new shared ownership homes ahead of their practical completion, enabling potential applicants to prepare and express interest in a timely manner.

7.2 The Council will use existing communications channels to advertise Shared Ownership properties, including our website and our Keep Me Posted bulletin service. However, our preference will be to advertise all our properties, whether they are initial sales or resales, using the Shared to Buy (opens in new tab) website.

7.3 While the properties will be marketed publicly, the Council will follow the priority criteria as set out in this Policy.

7.4 All prospective purchasers will be provided with clear and accurate information, including key property details, eligibility criteria and guidance on the application process, ensuring transparency and informed decision-making throughout. Applicants should ensure that they seek legal advice prior to reserving a shared ownership property.

7.5 The Council prefers that correspondence throughout the sales process is made in writing via email. This allows for a clear and consistent record of communications for auditing purposes as required by the Capital Funding Guide. However, we can adjust our communication methods to meet the need of applicants, particularly if they are vulnerable.

7.6 Applicants / buyers can correspond with the Council using the following email: housing@dover.gov.uk (opens in new tab).

Eligibility

7.7 Householders looking to purchase a Council Shared Ownership property must satisfy the following eligibility criteria before the sale can proceed:

• 18 years or older

• Have a household income is £80,000 a year or less

• Cannot afford all the deposit and mortgage payments for a home that meets your needs on the open market.

One of the following must also be true of the applicant(s):

• They are a first-time buyer

• They used to own a home but cannot afford to buy one now

• They are forming a new household – for example, after a relationship breakdown

• They are an existing shared owner who wants to move • They own their home and want to move but cannot afford a new home that meets their needs.

7.8 Applicants must also:

• be able to purchase a home suitable for their needs without assistance with upkeep of the property.

• not have any outstanding credit issues (i.e., Individual Voluntary Agreements, bankruptcy petition, unsatisfied defaults or county court judgements (CCJs)).

7.9 Where applicable, the Council will also require the following criteria to be met:

• current or former Council tenants must have a clear rent account and have no substantial breaches of tenancy conditions.

• applicants must have sufficient funds to meet the initial costs of buying a home and can provide evidence of funds or mortgage availability for the purchase of the property.

• be able to demonstrate they can afford to purchase a share equal or greater than 10% of the property value but they are unable to afford a 100% of the purchase.

• be able to demonstrate the ability to afford the regular payments and costs involved in buying a home

7.10 Where the applicant(s) is a current or former Council tenant(s) and has rent or service charge arrears, we will require the arrears to be paid off in full before we process an application to the next stage.

Immigration status

7.11 Individuals subject to the ‘No Recourse to Public Funds’ (NRPF) condition – such as those with limited leave to remain, pending asylum claims, or no lawful status – are not eligible for Council shared ownership. Proof of immigration status and right to reside will be required as part of the application process.

7.12 Applications from individuals subject to immigration control will be reviewed individually, considering eligibility evidence as well as both affordability and sustainability, and whether a qualifying lending institution will lend to the applicant. However, we will adopt a case-by-case approach to applicants.

7.13 We reserve the right to reject an application where we have concerns around eligibility or financial sustainability is in doubt, to ensure responsible allocation of housing and public funds.

Members of the Armed Forces

7.14 In accordance with the Capital Funding Guide, Ministry of Defence personnel will be given priority for Council Shared Ownership schemes where:

• They have completed their basic (phase 1) training, and they are one of the following:

o Regular service personnel (including Navy, Army, and Air Force

o Clinical staff (with the exception of doctors and dentist)

o Ministry of Defence Police Officers

o Uniformed staff in the Defence Fire Service

• They are ex-regular service personnel who have served in the Armed forces for a minimum of six years and can produce a Discharge Certificate (or similar documentation) as proof, where they apply within two years (24 months) of the date of discharge from service.

• They are the surviving partners of regular service personnel who have died in service, where they apply within two years (24 months) of the date of being bereaved. Further guidance can be found in the Ministry of Defence Surviving Partners Guidance (opens in new tab).

Owner occupiers

7.15 Those who already own their own home will only be permitted to purchase a Shared Ownership home in exceptional circumstances. Examples of exceptional circumstances include but are not limited to:

• homeowners who need to move because their own home has been condemned or is to be demolished.

• those needing to move due to age or disability and who cannot afford or find accommodation on the local open market that reasonably meets their needs.

• those going through a relationship breakdown and will have insufficient capital remaining to purchase a home on the open market in the district. Where this is the intention, we will require evidence from the Buyer’s solicitor explaining the circumstances.

7.16 Existing homeowners accepted onto the scheme must meet the affordability criteria and demonstrate that they can sustain their mortgage and Shared Ownership rental payments. They will also be required to evidence that at the time of buying through the Shared Ownership scheme they have sold or are in the process of selling their existing property.

7.17 The Council will require an existing homeowner’s solicitor to provide a confirmation letter stating that the sale is in process, and that once the sale has completed, the applicant will not have an interest in any other property.

7.18 The Council encourages for there to be a simultaneous exchange of contracts and completion as this will reduce the time an existing homeowner, now a shared ownership purchaser, could be without a property.

Joint Applications

7.19 Joint applications will only be accepted if both applicants meet the eligibility and affordability criteria as set out in this Policy.

7.20 If an applicant has a joint tenancy and is a tenant of a housing association or privately rents, and they are the only applicant applying for the shared ownership property, the application can proceed in the sole name of the qualifying applicant. In these cases, the Council will not be obliged to rehouse the tenant not applying for the shared ownership property if they need to vacate their existing property.

Local connection tests

7.21 For some shared ownership properties, a local connection to the area may apply. This will generally apply to rural areas where land has been made available for affordable housing to meet the needs of local people, rather than for private investment. These sites are referred to as ‘rural exception sites’ or ‘designated protected areas’.

7.22 Where a local connection applies, applicants will be prioritised and allocated based on their connection to the area. The criteria can vary between different developments, but it is usually based on:

• the applicant(s) was born in the area and has lived there for several years; or

• the applicant(s) has permanently lived in the area for several years; or

• the applicant(s) used to live in the area for several years but had to move away because of a lack of affordable housing; or

• the applicant(s) has been permanently employed in the area between 2 and 5 years.

7.23 If no applicant(s) comes forward with a local connection to the area, applications received from neighbouring parishes and villages, then rest of the district will be considered. The order of priority will be as follows:

1. applicants with a local connection to the parish/village

2. applicants with a local connection to the surrounding parishes/villages

3. applicants who are residents of the district

7.24 We will ensure that where a local connection test applies to a shared ownership property, it is clearly advertised, including an outline of the local connection test information, and our allocation and prioritisation process for the properties. We will also assist and work with local town and parish councils in which the properties are situated.

Designated Protected Areas (DPA)

7.25 The Housing and Regeneration Act 2008 enables the Secretary of State to designate ‘protected areas’ ensuring shared ownership houses are retained as such in areas where they would be difficult to replace.

7.26 Where a shared ownership property is in a Designated Protected Area (DPA), the lease will contain one of the following provisions:

• To restrict staircasing to no more than 80%; or

• In instances where the Shared owner is permitted to acquire more than 80% (i.e., full ownership) then there is an obligation on the landlord specified in the lease that commits them to repurchase the property when the Shared owner wishes to sell for fair market value and certain conditions are met.

7.27 The restrictions mentioned in paragraph 7.26 apply to both grant-funded and nil-grant funded shared ownership homes, ensuring consistency in policy and reinforcing the Council’s commitment to protecting affordable housing regardless of funding source.

7.28 Where applicable, restrictions will be clearly incorporated into the lease agreement. We will also ensure that prospective buyers are made fully aware of these restrictions during the marketing and sale stages. For the avoidance of doubt, buyers should take independent legal advice and ensure they understand the terms of the lease prior to completion.

7.29 We reserve the right to exercise discretion to remove the restrictions in paragraph 7.26. Any such decision will be considered on a case-by-case basis considering factors such as housing need, market conditions and long-term sustainability of affordable housing provision in the area.

7.30 Following the expiry of any nominations period during a resale, shared owners are required to accurately communicate these restrictions to their chosen estate agent to ensure the property is marketed in accordance with the terms of the lease. Failure to do so will constitute a breach of the lease agreement and can result in enforcement action.

Elected members, staff, and relatives

7.31 Elected members, staff and their relatives can apply for Council Shared Ownership properties, provided that they meet the eligibility and affordability requirements.

7.32 Will seek appropriate authorisation to proceed in the specific circumstances.

Advisor requirements

7.33 Applicant(s) affordability must be assessed by a suitably qualified and experienced advisor who is regulated to give mortgage advice and must meet the minimum requirements as set out in the Capital Funding Guide (section 1, subsection 6.3).

7.34 Advisors are responsible for:

• Completing a full affordability assessment.

• Completing an Affordability Checklist, including the Affordability Sign-off Form. This must be signed by the Advisor and the applicant(s). We will also countersign this once we are satisfied affordability is met.

• A completed Minimum Surplus Income Calculation. We can supply Advisors with our own calculator, or they can use their own, but this must follow the methodology as set out in the Capital Funding Guide (please see paras. <>).

• A budget planner. Advisors should refer to the Homes England Budget Planner Guidance Note.

Assessing affordability

7.35 We expect advisors to comply the principles of the affordability assessment process as outlined in the Capital Funding Guide when completing an affordability assessment. In particular, the following Capital Funding Guide sections:

• 6.5 – Principles of the affordability assessment process

• 6.6 – Assessing an applicant’s income and expenditure

• 6.7 – Assessing the suitable share to be purchased

• 6.8 – The sign-off sheet

• 6.9 – Mortgages

• 6.10 – Cash purchases

And where applicable

• 6.11 – Home Ownership for people with long-term disabilities (HOLD)

• 6.12 – Older Persons Shared Ownership

We require completion of the affordability assessment in one stage for greater certainty and efficiency.

We may request other documentation from the advisor where required.

7.36 We will provide the necessary property details to the advisor to enable them to complete their affordability assessment. We will include these in the Affordability Declaration Form. The information will include:

• Site, plot and address details (if known).

• The type of shared ownership product (i.e., standard shared ownership, OPSO, HOLD, Designated Protected Areas).

• Open market value of the property.

• The minimum share available or the share currently owned if a resale.

• Rent as a percentage of the unsold equity and service charge figures for new sales; or the current rent and service charges for resales.

• The basis of future rent reviews; either RPI+0.5% or CPI+1%.

• Warranty provider details.

7.37 We will only proceed with applications once we have received fully completed documentation, and that after assessment of the facts, it is evidenced that the applicant(s) can afford to purchase a share and meet our minimum surplus income requirements.

Minimum surplus income requirement

7.38 In line with regulative guidance the Council can only sell our Shared Ownership properties to applicants where, following the assessment by an Advisor, it is evidenced that they meet our minimum surplus income requirements.

7.39 Our policy is that 10% or more of the net income must be available once all deductions have been made to the gross income for mortgage purposes.

7.40 Advisors are responsible for conducting these calculations and confirming that applicants meet our minimum surplus income requirements. Advisors can use our minimum income surplus calculator or their own to determine this, but the result must demonstrate compliance with this Policy. This calculator must be submitted to us as evidence along with the other documents listed in clause 7.34.

7.41 The 10% minimum surplus monthly income is to be calculated using the Homes England methodology below. The items and examples below do not represent an exhaustive list but should serve as a guide setting out the minimum expectations for what such budget planners should contain.

7.42 The Council reserves the right to decline any application where the minimum surplus income falls below the required 10% of the applicant’s Net Income.

7.43 If the applicant(s) does not meet the requirements of this Policy, we would consider the property to be unaffordable to the applicant(s).

Suspected fraud

7.44 We take suspected fraud of all kinds very seriously and will not hesitate to act to prevent fraudulent activity. When dealing with suspected fraud, we will act in accordance with our internal policies and procedures.

7.45 If an application is found to be fraudulent it will be cancelled, and further action may be taken by the Council if appropriate. Applicants will be notified of a decision to abandon an application due to suspected fraud.

First come first served policy

7.46 In line with regulatory guidance, we operate an open and fair process when marketing and selling our Shared Ownership homes, which in most cases will be on a first come first served basis.

7.47 Our First-come, First-served (FCFS) policy is based on the following:

• Whomever is first to pass their full assessment and submit all their documents, which are subsequently approved.

• Each full assessment will only be considered upon receipt of the final document received by us which then allows us to assess an application.

7.48 Where we are advertising shared ownership home for resale (on behalf of the current shared owner(s)), our FCFS policy will be followed. Where a shared ownership property is being offered for sale by the owner or directly through their chosen estate agent our FCFS policy will not apply. The shared owner(s) will have the ultimate decision on their choice of buyers from those who meet all eligibility criteria as advertised e.g., qualify for shared ownership, meet a local connection criteria etc.

Applicant priority

General rules

7.49 Where homes are grant funded by Homes England, the priority marketing cascade outlined in paragraphs 7.54-7.57 does not apply and will be subject to Home England’s funding conditions. As such, any prioritisation or restrictions will align with the terms of the grant agreement and Homes England guidance.

7.50 Members of the armed forces are exempt from local connection test(s) or criteria as stated in the Capital Funding Guide. However, priority and allocation of Council shared ownership properties will only be given to Members of the Armed Forces where a shared ownership property is available and has not already been reserved by an eligible applicant(s) and / or the sale has not been agreed and the property becomes available.

7.51 We will not proceed with an application where the occupation of the property would result in statutory overcrowding. We will apply Part X of the Housing Act 1985 (the space standard) when determining whether a property would be statutorily overcrowded.

7.52 Where properties are specialist schemes and intended for select groups (e.g., Older Persons Shared Ownership (OPSO), or Home Ownership for People with Long-term Disabilities (HOLD)) the priority criteria for this will be published when a new scheme goes live.

7.53 Properties in rural areas will be subject to a more detailed eligibility criteria. This is due to the provisions within the Housing and Regeneration Act 2008 and local lettings policies as set out in section 7.6.

Nil-grant funded homes

7.54 We operate a priority marketing cascade for selected developments, that are not subject to rules and regulation contained in the Capital Funding guide, to ensure that Council shared ownership homes are allocated in a way that best meets local housing needs and helps reduce underoccupancy in family-sized homes (typically 3, 4 or 5- bedroom homes). This approach gives priority to specific groups of applicants during the initial marketing period.

Example:

For a shared ownership scheme which includes 3 and 4 bed family homes:

• Weeks 1 – 8: Priority is given to family households (e.g., couples with children, single parents with children) on a first-come, first-served basis.

• Week 9 onwards: Open to all eligible applicants on a first-come, first-served basis.

7.55 The length and structure of an allocation cascade will be applied on a site-by-site basis, and may vary depending on:

• The size and type of property (typically 3, 4 or 5-bedroom homes)

• The location of the development

• The level of housing need in the surrounding area

This targeted approach supports the efficient use of housing stock and helps ensure that larger homes are occupied by households who need them most.

7.56 Our First-Come, First-Served policy will remain in effect for those applicants that meet the Council’s criteria during the priority cascade and will resume in the way specified in paragraphs 7.43-7.45 after the priority cascade period.

7.57 We will ensure that full details of any cascade – including eligibility criteria and priority groups – will be clearly outlined in the property advertisements and marketing materials.

Leases

7.58 Shared owners must abide by the requirements in their lease agreement. Shared owners should send any queries about their lease agreement in writing via email to: homeownership@dover.gov.uk (opens in new tab)

7.59 The length of a lease can vary depending on the model of shared ownership, but in general they can range from 99 – 990 years. However, from 2024 all new shared ownership properties will have a standard lease of 990 years.

Breaches of the lease agreement

7.60 We will take appropriate action whenever we become aware that a Shared owner is acting in breach of the terms of their lease. This includes, but is not limited to:

• non-payment of rental income for 21 days after becoming payable; and

• unapproved works to the home or building; and

• improper use of the home or building (i.e., for illegal activity); and

• failure to maintain or damage the premises; and

• refusal of access to DDC staff, or contractors working on behalf of DDC; and

• anti-social behaviour including, but not limited to, harassment or neighbour nuisance.

7.61 Where possible, we will work with the Shared owner to resolve the issue, however if the breach is serious or persists then we may decide to pursue legal action against the Shared owner. This may include seeking an injunction, or action for the forfeiture of the lease.

Rent and service charges

7.62 In addition to mortgage payments, Shared owners are expected to pay both rent and service charges. Rent is payable on the unsold proportion of the property and usually set at 2.75% although this can vary.

An example of the calculation is as follows:

Rent per month = Unsold equity x 2.75% / 12

An example for illustrative purposes would be:

7.63 Rents are subject to an annual review and set in accordance Section 4 of the Capital Funding Guide. We will calculate the rent in accordance with the procedures set out in legislation, relevant guidance and the Capital Funding Guide.

7.64 It is a condition of the lease agreement that Shared owners keep up the payment of rent and service charges. Failure to do so would put the Shared owner in breach of the lease agreement, and the Council will take appropriate steps to recover outstanding payments, which may include taking enforcement action to resolve the issue.

7.65 Any ground rent charges will be in keeping with the acceptable levels for the type and location of the property and/or comply with any law, rules, or regulations in force (please see 13.10).

7.66 Shared owners should refer to the Leasehold Management Policy for further details on service charges, a breakdown of the charges, how they can request a service charge summary, and information on our enforcement action.

Fees and charges

7.67 The following non-refundable fees will be charged in these circumstances:

1. Shared Ownership resales. This will be charged to the seller.

2. Shared Ownership staircasing of 5% or more. This will be charged to the shared owner(s).

3. Shared Ownership downward staircasing. This will be charged to the shared owner(s).

4. A legal administration fee. This will be charged to either or both the shared owner and the buyer.

7.68 The fees are charged to cover administrative and / or marketing costs. Other fees may be charged to supply of replacement documents and certificates. We publish our annual fees on our website. Our fees are reviewed on an annual basis and may increase with inflation.

Initial share

7.69 Prospective buyers are required to purchase the maximum share they can afford as demonstrated on their affordability assessment documentation. Applicants will be made aware of the minimum and maximum shares they can purchase when they apply, but in general, the initial share can be between 10%-75%.

Initial valuations

7.70 Prior to the marketing and sale of a property, an independent valuation will be carried out by an independent Royal Institute of Chartered Surveyors (RICS) qualified surveyor. Initial sales will be based on the agreed full market value of the property.

7.71 The valuer will be instructed to assume that:

• the sale is for the freehold interest, or where the Council’s interest is the leasehold, for the lease term years we hold.

• the sale is an open market sale.

• a Shared Ownership lease has not been granted.

• the sale is to be with vacant possession.

7.72 We expect all surveyors carrying out a valuation to ensure it is a true reflection of the property’s value.

Older Persons Shared Ownership (OPSO)

7.73 OPSO is a form of Shared Ownership available to people aged 55 years and over. It works in the same way as the general Shared Ownership scheme; however, applicants can only buy up to 75% of the property. Once 75% is owned, shared owners will not have to pay rent on the remaining share.

7.74 OPSO applicants will be assessed in accordance with the general principles of this Policy, and Section 6 of the Capital Funding Guide. We understand that some OPSO applicants may be cash buyers, in which case 6.10 of Section 6 of the Capital Funding Guide will be relevant to such applications.

7.75 We acknowledge that many OPSO applicants may need to retain higher levels of savings or investments than other applicants to provide ongoing income, or to cover ongoing and future living and care costs. In such cases, our decision to proceed with an application will be based on the individual circumstances of the applicant. These should be detailed on the Budget Planner.

Home Ownership for People with Long-Term Disabilities (HOLD)

7.76 HOLD operates on the same basis as Shared Ownership but is tailored towards supporting individuals with long-term disabilities into homeownership.

7.77 HOLD applicants will be assessed in accordance with the general principles of this Policy, and Section 6 of the Capital Funding Guide.

7.78 For some HOLD applicants where a standard mortgage is unlikely to be available to them, it is advisable that they seek the services of more specialist advisor with knowledge and experience of specialist mortgages which may be available to HOLD applicants.

Registration of interest

8.1 To apply for Council shared ownership schemes, applicants must complete a registration of interest (RoI) form for any scheme we advertise via the Share to Buy website or the Council website.

Application for shared ownership

8.2 Applicant(s) are required to complete an Application Form. This will be sent to them once we have received the RoI. The Application Form enables us to determine if the applicant(s) are eligible for Shared Ownership.

8.3 Applicants must also submit an Agreement in Principle (AIP) with their application. AIPs can be provided by an Advisor, or applicants can complete these themselves using lender websites.

8.4 We aim to have completed an assessment of the Application Form within 5 working days of receiving it. If there is a delay to the assessment checks, the Applicant(s) will be informed at the earliest convenience.

8.5 We will only progress applications to the next stage where we have received a completed Application Form and AIP, and the applicant(s) meet the eligibility criteria for Shared Ownership. If the Application Form is incomplete or contains errors, it will be returned to the applicant(s) for correction. This may delay the assessment of the application and the sales progression.

Withdrawing an application

8.6 We accept that there may be circumstances where an application will need to be withdrawn by either party. In this instance the following applies:

Applicant withdrawal -

Where an applicant wishes to withdraw their application, this must be submitted to the Council in writing, via letter or email at the earliest time possible. It is expected that the reasons for the withdrawal are included in the notification and are clear and unambiguous.

Council withdrawal -

The Council reserves the right to withdraw from the sale in some circumstances, such as where the applicant fails to complete the purchase of the property within a reasonable timescale, or there is suspected fraudulent activity. In these circumstances the Council will contact the applicant to confirm whether the Council intends to withdraw or provide notice to allow the applicant a final opportunity to complete the sale within the agreed timeframe.

Viewings and reservations

8.7 Viewings will only be arranged with applicants who meet the eligibility criteria, have submitted a completed application form, AIP and it is shown via their affordability assessment they can afford to purchase the property.

8.8 Viewings may be arranged individually or as part of an ‘open day’ event where multiple viewings take place at allotted times. Applicants will be made aware of the circumstances when the viewing is arranged.

8.9 Applicants must abide by any restrictions or safety instructions in place at the time of the viewing, or any additional measures implemented by the Council or the developer (e.g., the use of Personal Protective Equipment (PPE).

8.10 The property can only be reserved after the fixed reservation fee has been paid and the reservation form completed. The reservation fee will be offset against the purchase price. Active marketing of the property will cease when the property has been officially reserved.

8.11 Reservation fees are non-refundable. However, at our discretion and in certain circumstances the fee may be refunded, for example where one or more applicants have been made redundant, or due to severe illness the sale can no longer progress. This is not an exhaustive list and will be dealt with on a case-by-case basis.

Key Information Documents

8.12 In accordance with the Capital Funding Guide, Key Information Documents (KIDs) will be provided to all prospective purchasers prior to reservation. These documents outline the essential terms, property information, financial commitments and risks and warnings associated with the shared ownership scheme.

• KIDs are designed to support informed decisions-making by clearly presenting costs, responsibilities and potential future scenarios.

• We will make sure the KID is tailored to the specific property and ownership arrangement being offered.

• Any updates to the KID will be communicated promptly to applicants, especially where changes may materially affect affordability.

• Applicants should review the KID alongside an independent legal advisor, and we would encourage they do so with an Advisor before proceeding.

8.13 We will insist that applicants or their legal advisor(s) confirm to us that they have read and understood the KIDS and have sought legal advice.

Memorandum of Sale

8.14 A memorandum of sale (MoS) will be issued once the sale has been agreed and the reservation fee has been paid. This can take up to 7 working days.

8.15 Once a sale has been agreed, we expect the applicants to cooperate with the Council and progress the transaction towards exchange and completion as soon as is reasonably practicable. We reserve the right to discontinue an application due to lack of progression from the buyer. We understand that each sale is different and will assess what action is appropriate on a case-by-case basis. The Council expects sales to complete within 3-5 months; however, it may be necessary for this period to be extended should the matter become complex.

8.16 It will be at our discretion whether the reservation is held beyond the target exchange date, and this will be determined by the cause of the delay and whether it is related to an issue beyond the buyer’s control. All decisions to extend will be agreed on a case-by-case basis, at our discretion and confirmed in writing.

Mortgage offers

8.17 Prior to completion, we will require a copy of the buyer’s mortgage offer, including the amount of borrowing and the terms and conditions being applied.

8.18 Mortgages must be obtained from a lending institution that is regulated by the Financial Conduct Authority (FCA) and, where required, regulated by the Prudential Regulation Authority.

Exchange and completion

8.19 Once the Council’s Legal Team and the buyer’s conveyancer have completed the pre-contract stages of the conveyancing process, and there is a mutual agreement, the sale can proceed to exchange and completion.

8.20 Exchange and completion dates are agreed by the Council’s Legal Team and the buyer’s solicitor. At completion it is expected that:

• The buyer(s) has paid their share amount (i.e., deposit and mortgage)

• The buyer(s) has signed the lease agreement

• The buyer(s) has paid 1-full months rent and service change in advance

• The Council will hand the property keys to the buyer(s) along with any other applicable documents.

8.21 When the lease agreement is signed by the Shared owner(s) and the document is dated by the Council’s Legal Team, the buyer(s) becomes the Shared owner(s) and is legally obligated to abide by the lease covenants.

9.1 Shared owners are required to notify the Council in advance if they intend to change their mortgage provider. In every instance, written approval from the Council must be obtained before entering into any new mortgage agreement. This approval will confirm acceptance of both the proposed lender and the terms of the new mortgage.

Please note, without our written consent, the new mortgage cannot be registered with the Land Registry, and the remortgage process may be delayed or deemed invalid under the terms of the shared ownership lease.

9.2 Shared owners will need to provide details of the redemption figure from their current mortgage lender and inform the Council of how much they will borrow on the new mortgage before the request can be agreed.

9.3 A copy of the re-mortgage must be given to the Council once it has been agreed and issued by the lender.

Additional borrowing

9.4 If a shared owner wishes to remortgage to raise capital or secure additional borrowing, they must first obtain formal approval from the Council. Applications will be assessed on a case-by-case basis, and approval is not guaranteed.

9.5 Please note that we will not approve remortgage applications intended for the following purposes:

• Personal loans

• Debt consolidation

• Speculative investments

9.6 To support their application, shared owners must submit to us the following documentation:

• A statement from their Advisor detailing the purpose and necessity of the additional funds.

• A complete budget planner demonstrating clear affordability of the revised financial commitments.

• Any additional evidence requested by the Council to support the assessment.

Failure to provide adequate documentation or meet affordability requirements may result in the application being declined.

General

10.1 We expect Shared owners to have read through the section pertaining to resales in the Shared Ownership Guide prior to submitting confirmation that they wish to sell their share of the property. In summary this includes:

• Understanding roughly how much the property is worth; and

• Having appointed a solicitor to conduct all the legal processes regarding the sale; and

• Carrying out a valuation of the property (see “Valuations”).

10.2 The Council requires shared owners to contact us in writing when they decide to sell their property. Correspondence should be sent to homeownership@dover.gov.uk (opens in new tab).

10.3 Prior to notifying the Council of intentions to sell, all shared owners named on the lease must agree to selling the property, and must ensure that any arrears on rent, services charges and any additional costs incurred whilst living at the property have been repaid in full.

Right of first refusal

10.4 If a shared owner submits an intention to sell form to the Council, we reserve the right to repurchase the shared owner’s equity share at the current market value, as determined by a RICs-accredited surveyor. Where this intention is exercised, we will provide written notification to the shared owner at the earlier opportunity, outlining the valuation and next steps in accordance with the lease agreement.

10.5 This right is discretionary and does not constitute an obligation for the Council to purchase a shared owner’s equity share.

Nominations period

10.6 Where a shared owner intends to sell their share in the property, we retain the right to nominate a buyer. This is known as a ‘nominations period’ and depending on the lease, can range between 4-12 weeks. During the ‘nominations period’ the property can only be advertised by the Council and the shared owner cannot advertise the property themselves until the period ends. Shared owners should refer to their lease agreement for further details.

10.7 Some circumstances mean we cannot apply a nominations period. This includes:

• where the Shared owner or someone else on the lease has died; or

• where the Shared owner has been ordered by Court to transfer their lease

10.8 During the length of the nominations period, we will advertise the property and nominate an eligible buyer. The shared owner must not advertise the property during this fixed period.

10.9 Once a purchase has been nominated (the “nominee”), the shared owner is required to make a formal, unconditional offer to sell their share of the property in accordance with provisions contained in the lease. The Offer must comply with the following terms:

• The sale must be for the entire premises with vacant possession

• The offer must remain open for a minimum period of 6 weeks from the date of issue.

• The stipulated completion date must not be earlier than 4 weeks following the acceptance of the offer.

• The transaction must be conducted under the Law Society’s Standard Conditions of Sale.

• The agreed purchase price must reflect the acquired percentage of the property’s current open market value, based on vacant possession.

10.10 Should the Council not be able to nominate a buyer within the nomination period set out in the lease; the shared owner may proceed to market their share on the open market. In these instances, the sale must still comply with the conditions outlined in the procedure as set out in the lease for Nominations and Resales must be followed.

10.11 The only exception to 10.10 is where the property is situated in a Designated Protected Area (DPA) (see 7.25 – 7.27), in which case the Council will opt to nominate an eligible candidate (nominations period) or buy back the property. We advise Shared owners to check their lease agreements for any restrictions.

10.12 After a sale has been agreed, whether a nomination or a purchaser found on the open market, a Licence to Assign will be required. This is secured by a restriction in the lease agreement and issued by the Council’s Legal team to the vendor’s and buyer’s appointed solicitors.

Valuations

10.13 At resale, the Shared owner will be responsible for arranging and paying for the valuation of their property.

10.14 The Council will assess, and if the Council agrees with the valuation, approve of the valuation before to the resale can proceed.

10.15 Valuations to determine the current market value of the Shared owner’s share must be carried out by a Royal Institute of Chartered Surveyors (RICS) qualified surveyor, and no earlier than 8 weeks prior to the notice having been given.

10.16 We will only accept valuations conducted by surveyors who hold valid accreditation with the Royal Institute of Chartered Surveyors (RICS). Any valuation submitted by a non-RICs qualified surveyor will be rejected, and we will not be liable for any costs incurred by the shared owner because of this rejection. Additionally, we will not accept responsibility for costs arising if the sale does not complete within the 3-month validity period of the valuation and an updated valuation is required.

10.17 In the event that the shared owner disputes our determination of the valuation, the matter can be referred to an independent surveyor for resolution. The surveyor will be RICS-qualified, jointly appointed by the Council and the shared owner. The valuation provided by the appointed surveyor will be considered final and binding on both parties, and will be used to determine the transaction value. The cost for this valuation will be shared equally.

10.18 Where the sales price of the home is below the initial market valuation because of building safety issues (as identified in the Building Safety Act 2022), the Council will work with the Shared owner to secure a new valuation as quickly and cost effectively as possible. This could include commissioning a desktop assessment valuation or using the incoming buyer’s valuation (if this is completed by a RICS-qualified surveyor).

General

11.1 Buying additional shares in a Shared Ownership home is called ‘staircasing’. Shared owners can staircase to 100% of the property. However, there are some exemptions to this where the property is:

• An Older Persons Shared Ownership (OPSO) the maximum share that can be owned is 75%; or

• In a Designated Protected Areas (DPA) (see 7.1) where the maximum share that can be owned is 80%

11.2 Depending on the model of shared ownership, shared owners can purchase different amounts of additional shares:

• ‘Old model’ lease agreements usually allow Shared owners to purchase additional shares between 10% - 25% or more.

• ‘New model’ lease agreements usually allow Shared owners to purchase additional shares of 5% or more, and 1% shares for the first 15 years of ownership from initial sale.

11.3 We advise shared owners to consult their lease agreement for information regarding their staircasing options.

11.4 We expect shared owners who are interested in purchasing additional shares in their property to have reviewed this Policy prior to applying to staircase. In summary this includes:

• Understanding roughly how much the property is worth; and

• Understanding how much the shared owner can afford to purchase in additional shares; and

• Carrying out a valuation on the property (see ‘valuations and home improvements’).

11.5 The shared owner must complete and submit an Intention to Staircase Application Form to homeownership@dover.gov.uk (opens in new tab) to start the staircase application process.

11.6 Shared Owners are responsible for covering all costs associated with the staircasing process, including the arrangement of a RICS-accredited valuation and any legal fees incurred when purchasing additional shares.

Valuations and home improvements

11.7 Any alteration to the property must be consented to by the Council as per the lease agreement.

11.8 All valuations must be conducted by a RICS-qualified surveyor, and no earlier than 8 weeks prior to the notice of an intention to staircasing having been given.

11.9 Valuations are usually only valid for 3 months. Shared owners must ensure they complete the purchase of additional shares within this period, otherwise they risk having to pay for another survey. Some valuations can be extended, but Shared owners remain responsible for arranging this with the surveyor.

11.10 The Council will not accept a valuation where the surveyor is not RICS-qualified and will not be liable for any costs incurred by the Shared owner if the valuation is rejected for this reason. Likewise, the Council will not be liable for any costs incurred by the Shared owner where they fail to complete their purchase within the 3-month validity of the valuation.

11.11 Improvement to properties may influence the property value, thereby impacting on the share values. Therefore, all valuations need to show 2 valuation amounts:

• The current market value – this includes the property’s value including any increase due to the home improvements.

• The unimproved value – this is the property’s value ignoring any home improvements carried out.

11.12 If the Shared owner had our written permission to carry out the improvements, the price of additional shares will be based on the unimproved value. If the Shared owner did not have our written permission to carry out the improvements, the price of the additional shares will be based on the current market value. This amount is likely to be higher.

11.13 The above method is in accordance with current guidance via the Capital Funding Guide and Shared ownership homes: buying, improving, and selling (opens in new tab) guide.

11.14 The Council must approve the valuation report prior to the application proceeding. The valuation must be submitted with the staircasing application (see point 11.5).

11.15 Some older lease agreements specify that the Council is responsible for appointing a RICS-qualified surveyor to conduct the valuation. In such cases, we will either agree:

• To arrange the appointment of the surveyor in agreement with the shared owner OR

• To permit the shared owner to arrange the appointment of their chosen surveyor

In either case, the shared owner remains responsible for covering the full cost of the valuation. We advise shared owners to check the terms of their lease to confirm who holds responsibility for arranging the valuation, as procedures may vary depending on the lease’s age and structure.

11.16 In the event that the shared owner disputes the Council’s determination of the valuation, we will refer to the decision of an expert (RICS-qualified surveyor) appointed jointly by both parties. The result from this valuation will be final and accepted by both parties.

11.17 Where the sales price of the home is below the initial market valuation because of building safety issues (as identified in the Building Safety Act 2022), we will work with the shared owner to secure a new valuation as quickly and cost effectively as possible. This could include commissioning a desktop assessment valuation or using the incoming buyer’s valuation (if this is completed by a RICS-qualified surveyor).

Buying shares of 5% or more

11.18 Shared owners must carry out the tasks associated with staircasing as stated in 11.4 when they wish to purchase shares of 5% or more. The cost of the new share will depend on the value of the property.

11.19 The shared owner will need to pay for an independent valuation conducted by a RICSqualified surveyor as stated in 11.6.

11.20 We advise Shared owners not to proceed with their mortgage application until we have verified the valuation. The Council is not liable for any non-refundable costs incurred by Shared owners if we do not approve the valuation.

Buying shares of 1%

11.21 Most new model shared ownership properties allow Shared owners to buy 1% shares each year for the first 15 years that the property is owned. Shared owners cannot buy 2%, 3% or 4% shares. Unused options to buy 1% shares cannot be carried over to future years.

11.22 In cases where Shared owners want to buy 1% shares, the Shared owner must contact the Council to initiate the staircasing process. We will not charge an administration fee for the purchase of 1% shares. The price of a 1% share will be based on a Housing Price Index (HPI) valuation. This will be conducted by the Council’s Principal Valuer and / or the Senior Valuation Officer.

11.23 Either the Shared owner or the Council can choose to have a RICS valuation instead of an HPI. Where this is the case, the results of the RICS valuation will be used as the basis for future HPI valuations. Valuations are only valid for 3-months.

11.24 Where the Shared owner has chosen a RICS (11.8.3) valuation they will need to pay for and arrange this. The Council must approve the valuation so that we can verify and agree to the findings. We will not accept a valuation by a non-RICS registered surveyor and will not be liable for any costs incurred by the Shared owner if the valuation is rejected for this reason, or for any costs incurred by the Shared owner where they fail to complete their purchase within the 3-month validity of the valuation.

11.25 If the Council decides to have a RICS valuation carried out, we will pay for the valuation and will inform Shared owners at the earliest convenience. Details of the valuation results will be shared with Shared owners.

12.1 The Council will adhere to the provisions within the Capital Funding Guide (opens in new tab) regarding the use of Recycled Capital Grant Funds (RCFG) and permitted use, following the provisions relating to downward staircasing. This is to ensure that we have carried out our duties in compliance with the Guide and grant funding requirements.

12.2 Downward staircasing is defined as:

• The repurchase of a proportion of the share of a property by the Council from a Shared owner in difficulty, but not necessarily in arrears, with his/her household costs (mortgage, service charges, rent); and

• The repurchase of a proportion of the share of a property to pay for essential repairs or maintenance if the Shared owner cannot afford to pay for work (more generally in cases where the property has been specifically built as Older Person’s Shared Ownership (OPSO))

12.3 The key principles of downward staircasing are:

1. Shared owners do not have a right or entitlement to downward staircasing, and the Council makes no commitment to do so. Any offer of downward staircasing remains at the Council’s discretion. Each case will be dealt with individually and based on our assessment of the facts.

2. The Shared owner must currently own less than 100% of the property.

3. The Council must be satisfied that the affordability issues are genuine, and that the Shared owner has explored and exhausted all other options. The Shared owner must produce evidence to prove their difficulty with mortgage payments and must be able to show that other short and long-term options have been exhausted, such as loan rescheduling or selling the property.

4. In all cases of any form of equity repurchase, the Shared owner’s lender and (if applicable) Homes England, must agree to the offer prior to the downward staircasing proceeding.

12.4 Some of the general rules that apply to normal staircasing, also apply to downward staircasing:

• The purchase of the proportion of the share of the property will be based on a current market valuation carried out by an independent RICS-qualified valuer. The Council must approve this valuation prior to the process proceeding.

• The Council will reject any valuation not completed by a RICS-qualified surveyor and will not be liable for any costs incurred by the Shared owner as a result of this decision

• The rent amount will be adjusted pro-rata to reflect the new unowned share amount; and

• The Shared owner is responsible for paying the valuation cost, as well as all their legal fees and any other applicable fees charged.

12.5 In order for a Shared owner to retain the property as a shared ownership tenure, their equity must not drop below 25% for older model shared ownership, or 10% for the new model.

12.6 Downward staircasing is not available to other owner occupiers, which includes former shared ownership Shared owners, Shared owners who now own 100% of the shared ownership property, or those who have bought a property through a discount or incentive.

13.1 The Council’s definition of a complaint is: “An expression of dissatisfaction, however made, about the standard of service, actions or lack of action by the organisation, its own staff, or those acting on its behalf, affecting an individual resident or a group of residents.”

13.2 The Council takes complaints made about any service it provides, or Officers who work for the Council who provide that service, seriously. If an applicant or a Shared owner wishes to make a complaint about the service they have received or with an officer, they can be made:

• In writing (letter or email)

• Using the online complaint form:

• Using the Council’s Complaint leaflets (these are available at the Council’s Office reception, or they can be posted to the applicant / Shared owner)

• Via telephone

• In person by an appointment.

13.3 All complaints received will be dealt in accordance with the Council’s Complaints Policy and Procedure. More information about how to make a complaint can be found on our website:

14.1 This Policy will be reviewed every two years, or in response to relevant changes in legislation, organisational structure, development of good practice, or to address operational issues.

14.2 Any minor amendments required will be made through delegated approval. Any amendments made because of changes to operational process or Government legislation will be made through the local decision-making process. Major changes will be consulted upon before a decision is taken to implement them.

15.1 The Council is committed to promoting equality of opportunity and to eliminating unlawful discrimination on the grounds of race, age, disability gender, sexual orientation, religion, belief, financial status, and any other difference that can lead to discrimination or unfair treatment considering the principles of the Equality Act 2010. Please see our Equality Policy (opens in new tab) for more details

15.2 A full Equality Impact Assessment (EIA) was conducted for this policy in accordance with our Public Sector Equality Duty (PSED) when carrying out our duties (S149 of Equality Act 2010), and mitigations put into place where potential negative impacts to individuals with protected characteristic were identified.

16.1 During the application process, data may be shared between parties to facilitate the progression of shared ownership applications, and sales and / or resales. In all cases where data is shared with other parties, the Council will ensure it safeguards and protects personal data in accordance with our Privacy Statement and Policy.

16.2 A tailored privacy statement for shared ownership which contains more detail on what information is collected and stored, and who the Council may share this data with, is available online. Any concerns with the Privacy Statement should be directed to the Council’s Data Protection Officer.