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    • Hellz85
    • By Hellz85 27th Nov 15, 9:00 PM
    • 42Posts
    • 31Thanks
    Section 157 housing act help
    • #1
    • 27th Nov 15, 9:00 PM
    Section 157 housing act help 27th Nov 15 at 9:00 PM
    Hi all

    I have found a house which I love, however, this house falls under/has a clause (?) section 157 of the housing act which states that you have to live or work in the area (Devon) for 3 years prior to buying the house. Even though I have very strong ties to the area (born, grew up, relatives) I have lived and worked away for too long. I have checked this with the council too and the only way around it seems to be if you are contributing to the community ie police, nursing, social work. I don't do any of these.

    There is no reason, however, why my parents can't buy the house and we transfer the house over to me in 3 years time. The council lady says this is fine and parents would be happy for this too. My question is, how much more will this cost us? They already own a home so I assume this would all need to happen before April to avoid a higher rate of stamp duty. How much are we likely to be charged to transfer back to me in the future? No mortgage required.

    Thanks in advance for anyone who can help
Page 2
    • jamesp31
    • By jamesp31 14th Apr 16, 6:59 PM
    • 63 Posts
    • 15 Thanks
    I realise this post is a bit old now but I thought I would add my own experience of section 157. 2 years ago we bought an ex local authority house in west Dorset which had been completely refurbished so seemed a great buy. The problem we encountered was when, just days away from exchange of contracts, we had a phone call from our mortgage provider (Britannia) to say they were withdrawing their mortgage offer as they do not lend on properties with such restrictions. They claimed they had not been told by the solicitor about this. I complained and eventually they decided to lend the money after all, whilst reminding me it was a one off and it was still their policy not to lend on properties with this restriction. So my advice to anyone thinking about buying a property which is subject to section 157, ask your lender right at the start of the application if they are happy to lend. When I started the application process I told them it was ex local authority but I never realised the significance of section 157 and never thought to mention it. Don't be caught out like we were.
    • devon007
    • By devon007 13th Apr 18, 3:48 PM
    • 60 Posts
    • 103 Thanks
    I know this is an old post but in case it comes up again - in South Hams they will sometimes apply another part of that Section regulation - the buyer needs to have worked for 7 of the previous 20 years (not consecutive years) within the District.

    I recently purchased a property where you needed residence or local connections, after coming back to the area 18 months ago from Wales where I moved in 2010. I had lived in the area from 1995 to 2010. I had still been working in Devon during that period but across various towns/cities as a locum through Somerset/Devon/Cornwall, although I now worked permanently in South Hams. I was allowed to buy :-)
    • jaxb
    • By jaxb 10th May 18, 3:31 PM
    • 1 Posts
    • 0 Thanks
    I am currently trying to buy a house in the South Hams District which is subject to the Devon Covenant, and am hitting a wall despite having been born in Cornwall and lived and worked in Devon from 1993 until 2010, when I moved to Hampshire for work.
    I am now returning to Devon; I have a job with a small local business within the Dartmoor National Park, aging/ill parents just across the border in Cornwall, and family and friends living and working in Devon.
    I believe I fit the spirit of the legislation but seem to be getting nowhere fast.
    Who did you present your situation to at South Hams Council?
    Any suggestions and help welcomed.
    • thor.nogson
    • By thor.nogson 1st Jun 18, 4:50 PM
    • 1 Posts
    • 0 Thanks
    Hi there
    My partner and I are in a similar position - mortgage was approved on a house in South Devon, then the issue of the section 157 covenant came up and whilst both of us buying the house have lived in Devon our whole lives, NatWest have now retracted the mortgage offer because of:
    "high risk quick resale potential should you default on your mortgage payments".

    This Devon rule was a nice sounding idea - aiming to prevent second homes and empty houses for half the year in South Devon (of which there are already many!) and to prevent local people being outpriced, but it's making it impossible for the very same locals to buy a house in the first place!
    So far been turned down by NatWest, Lloyds and Halifax and advised HSBC also say no to anything with a covenant.
    Have written to the Local Teignbrdge council general email enquiry address and looking for anyone willing to lend!
    Last edited by thor.nogson; 01-06-2018 at 5:37 PM. Reason: updated
    • Davesnave
    • By Davesnave 1st Jun 18, 6:22 PM
    • 26,425 Posts
    • 95,523 Thanks
    So far been turned down by NatWest, Lloyds and Halifax and advised HSBC also say no to anything with a covenant.
    Have written to the Local Teignbrdge council general email enquiry address and looking for anyone willing to lend!
    Originally posted by thor.nogson
    I think I'd approach a specialist mortgage broker. It's unlikely that you will get a deal at normal rates, but there may be a lender out there willing to take the risk for a % rate you could also accept.
    A garden is never so good as it will be next year....
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