House has 'Local needs'- surely a slight risk?

Special_K10

Special_K10 wrote: »

Just also bumping it for the same reason!

Sorry guys!

Richard_Webster

I think it will depend to some extent on whether there are enough such houses out there in any given area. The more there are the more they will change hands, presumably at a lower price than similar houses without the restriction and the more confident local valuers will be as to their value,i.e. the discount to be attributed to the clause. If there aren't many of them it is much harder to determine the discount and valuers wil be less confident of value.

Some lenders will not lend as a matter of principle, others rely on their valuers to vlaue accordingly. In the latter case, unless there is strong evidence of simialr porepryt selling withe clause they are likely to be quite conservative and may downvalue formthe "agreed" price.

Also, with proeprty of this nature there is no gauarantee that if say there is a 30% discount at the moment on simialr property without the restriction, that this percentage discount will still apply in the future.

Evan_Owen

90% of local occupancy restrictions can be removed by application.

kingstreet

I can't say too much about issues concerning S106 agreements and similar as I rarely come across them in this area.

My feeling is that such an agreement would put me off purchasing a property as it would restrict the mortgage lenders open to you and it could later discourage potential buyers for the same reason.

Notwithstanding the possibility that such a clause may be removable, who wishes to get involved in doing so, if the vendor can't face taking it on?

Evan_Owen

kingstreet wrote: »

Notwithstanding the possibility that such a clause may be removable, who wishes to get involved in doing so, if the vendor can't face taking it on?

You assume the vendor is aware of the possibility of discharging the restriction.

kingstreet

True. I am merely generalising.

When putting the property on the market, it seems possible the vendor would be informed of the difficulty in marketing a property subject to such a restriction, perhaps from a selling agent, solicitor or mortgage adviser?

Are you perhaps involved in the removal of such restrictions as part of your profession?

evanowen

I seem to have created another account using bookface

Local occupancy restrictions come in many guises, former local authority homes in national parks, AONBs and designated rural areas might have a covenant that was imposed by the authority which is known as a Section 157 (Housing Act). Without the agreement of the authority the homeowner would need to go to the Lands Tribunal to remove it, there are class actions being formed.

Then there are the old Section 52 and late Section 106 created before late October 1991. These also need the agreement of the authority or a trip to the Lands Tribunal.

More common is the post 1991 Section 106, 90% of these serve no useful planning purpose and can be discharged by application, or appeal if necessary. You can imagine how unpopular such activity would be with the planners and their political masters!

Any day now we expect an EU court decision on occupancy restrictions in Belgium, an Irish case has been rumbling on since 2007. Soon we will have one in the UK if we can find a cross-border complainant. These things are in breach of the EC Treaty.

Personally if I knew I could discharge an agreement after purchase and I had the funds to buy the dwellings at a huge discount I would soon be a wealthy landlord, sadly I don't have any money. Shame really because there are thousands of such afflicted homes up for grabs.

Smb100

I would seriously consider the disadvantages of buying a property with a housing clause because it is so restrictive when you want to sell. Plus the fact that hardly any mortgages will lend. My house has the clause in the Peak District and I cannot sell. The council is not interested and hides behind the legislation.

evanowen

Smb100 wrote: »

I would seriously consider the disadvantages of buying a property with a housing clause because it is so restrictive when you want to sell. Plus the fact that hardly any mortgages will lend. My house has the clause in the Peak District and I cannot sell. The council is not interested and hides behind the legislation.

Apply to have it discharged and appeal if they refuse.