We are committed to keep uncertainty to a minimum by giving residents the information and support that they need to make the best choices about their own and their families' futures. This page gives information for resident homeowners on their options if regeneration is going ahead on their estate.
If you have any questions please contact your estates team.
Please click on the links below for more information.
- Fundamental principles
- The key Guarantees and a new home
- Valuations and independent advice
- Choice of new home and moving
- Resident homeowner options for staying
- Leases for the new homes
- People who need extra support
- Recent Right to Buy purchases
- Estimated values for your estate
There are some fundamental principles that the Council will apply when regenerating estates:
- The Council wishes to minimise the impact and disruption of moving home and will, wherever possible, make sure that residents only need to move home once.
- Disturbance Allowances - The Council will reimburse you for all reasonable moving costs. This will mean no-one should be out of pocket due to moving expenses.
- Home loss Payments - The Council will compensate residents for making them move home. This payment equates to 10% of the current value of their property up to a limit of £53,000 (as at October 2015).
- The Council will always seek to negotiate voluntary agreement with resident homeowners for purchase or equity exchange before resorting to any compulsory purchase process.
These fundamental principles are based upon the Key Guarantees. We will be shortly consulting on how the Key Guarantees can be made even stronger within the Council’s legal powers and its current financial situation.
The Key Guarantees
The Council has made a commitment through the Key Guarantees to enable communities to stay together – so if residents wish to remain living on their current estate, then the Council wants them to be able to do so.
To allow homeowners to remain on their estate in a new home that they can afford the Council has created a number of options. If these options prove inadequate to enable those who want to stay on their estate to do so, the Council will explore other options, so long as they meet the following criteria:
- A homeowner remains a resident on the estate from point of submission of a planning application for redevelopment onwards.
- Any offer made to homeowners must comply with the Council’s responsibility as a public sector body to ensure that public funds are used appropriately and do not give undue benefit to private individuals or organisations.
- Any offer made to homeowners must satisfy the Council’s obligation as a public sector body to achieve ‘best consideration’ for disposal of assets. In simple terms, this means that it cannot give property or assets to private individuals or organisations that would allow them to make an immediate profit.
Under the Key Guarantees, resident homeowners can either stay on the estate (Route 1) or sell their property to the Council and move away from the estate (Route 2).
Route 1 – where a resident homeowner wishes to remain on the estate:
- The Council tells resident homeowners that it is ready to begin discussion with them about entering into a shared equity or other option to stay on the estate (Homeowners are likely to be approached according to the phases of the proposed development.)
- From that point forwards, any resident homeowner, who wishes to stay on the estate, can approach the Council to discuss their options and how they can remain on the estate.
- Where a resident homeowner has notified the Council that they wish to start negotiations, the Council will ask its agents to carry out a market valuation of the property.
- The resident homeowner can also get their own valuation from a surveyor of their choice.
- The Council will add the home loss payment to the market valuation and make an offer to the resident homeowner of the value of their existing property. Agreement will need to be reached with the resident homeowner on the value of their existing property.
- The Council and the resident homeowner will work together to identify the best option for the resident to enable them to remain on the estate.
Route 2 – where a resident homeowner wishes to move away from the estate:
- The Council tells resident homeowners that if they wish to sell their property to the Council and move away from the estate that they can start negotiations with the Council.
- From that point forwards, a resident homeowner who wishes to move away from the estate can approach the Council and begin negotiations.
- The Council will ask its agents to carry out a market valuation of the property.
- The Council will inform the resident homeowner of the reasonable costs that can be paid to them in the process of selling their property to the Council.
- The resident homeowner can get their own valuation from a surveyor of their choice.
- The Council will add the 10% Home loss Payment to the market valuation and make an offer to the resident homeowner.
- The Council and the resident homeowner will negotiate to reach agreement on the value of the property.
- The purchase goes ahead.
- The Council repays the valuation and legal costs incurred by the resident homeowner.
Valuations and independent advice
All valuations on behalf of the Council have to be done as if no regeneration is taking place so that the value is not made lower or higher by the regeneration proposals. The valuation will be based on historic and current sales and purchases on the estate and with reference to in the surrounding area. The valuation will take account of whether the property is leasehold or freehold.
Resident homeowners will be able to get their own independent valuation advice and the Council will reimburse the reasonable cost of this. As with any normal property transaction, homeowners will also be able to employ their own solicitor for the transaction and these reasonable costs will also be reimbursed.
Choice of new home and moving
Local lettings policies will be developed in collaboration with residents on each estate. This will set out clearly how the new homes will be allocated to meet the needs of different residents on the estate.
Resident Homeowner options for staying
1) 100% Leasehold ownership of a new home
Resident homeowners will be able to put the ‘equity’ of their existing property (the amount the Council and homeowner agree that their current home is worth), together with their Home loss Payment, into a new home on the estate. They can then top this up with further funds or by means of extending their mortgage so that they can own 100% of a new home on the estate.
2) Shared equity of a new home
Resident homeowners will be able to put the equity of their existing property (the amount the Council and homeowner agree that their current home is worth), together with their Home loss Payment, into a new home on the estate. Where the new property is valued higher than the existing property, the Council will retain the residual equity. This will mean, like a mortgage company, the Council will take a ‘legal charge’ over the proportion of the value of the property which is not owned by the resident. The resident homeowner would then be able to make payments to reduce the size of the charge held by the Council over time, if they wish. Otherwise the Council will keep the charge in place until the homeowner sells their property.
This option relies on the resident homeowner being able to transfer 100% of the value of their existing property, along with their Home loss Payment to the new property. This assumes that the resident homeowner either transfers or renews the same level of mortgage as they currently have. The Council would be a ‘silent’ partner in the new home and the homeowner would enjoythe same rights and responsibility as someone who has 100% ownership. Except for the special provisions around the Council’s legal charge on the property, the leases would be the same as those for 100% owned properties. The resident homeowner would be responsible for 100% of the service charges on the property.
3) Shared ownership of a new home
Shared ownership is where the resident homeowner owns a portion of the new home and the Council owns the remainder. The resident homeowner then pays rent on the Council’s proportion of the property.
Where a resident homeowner is unable to transfer all the equity from their existing property to the new property (for example: where they are unable to transfer their mortgage; where they wish to reduce the size of their mortgage; or where they are seeking to moveinto a larger property), then the shared ownership option is available to them. In this scenario, they will be required to purchase a minimum of 25% of the new property through a combination of the equity that they hold in their existing property, their 10% Home loss Payment and any mortgage that they are able or choose to raise.
A resident homeowner would then be able to buy the residual equity held by the Council over time, if they wish. Otherwise the Council will keep the residual equity until the homeowner sells their property.
The resident homeowner will be required to put their 10% Home loss Payment into equity in the new property. In the shared ownership situation, resident homeowners are required to pay a rent to the Council at a rate of 2.75% per year of the value of the equity retained by the Council.
4) Renting a home
Where a resident homeowner is unable to transfer or obtain the minimum25% equity share, as set out above, they would have the opportunity to rent a home on the estate. These homes will generally be let at market rents.
Leases for the new homes
The Council is drafting new leases which will apply to homes owned by Homes for Lambeth. The new leases will apply to the different types of ownership: 100% leasehold, shared equity and shared ownership. The Council will consult with existing resident homeowners on the form of these leases before they are adopted. As set out in the Key Guarantees:
All leaseholders in new Homes for Lambeth homes will be required to notify the Council when they put their home on the market for sale, assignment, sublet or underlet.
For Shared Equity and Shared Ownership properties only, the Council will allow the homeowner to transfer their leasehold interest to a spouse, civil partner or family member nominated by the homeowner.
The homeowner will need to let the Council know if they intend to let the property out. The homeowner will receive all of the income from letting the property. The length of the new leases will be 125 years from the time that a homeowner moves into their new home.
The Council recognises that there is a great deal of concern amongst resident homeowners that they may not be able to transfer across mortgages from their existing homes. To help residents homeowners obtain advice on this, the Council has briefed a selection of independent financial advisers who are familiar with this part of the housing market.
Their details are provided below:
- Censeo, Linen Hall, 162 – 168 Regent Street London W1B 5TD, 0845 050 7911 (freephone) Info@censeo-financial.com Contact: Anthony Hall
- Hillcrest Property Solutions, Home Chambers, 46 Newcastle Avenue Hainault, Essex IG6 3EE 020 8172 0209 Info@hillcrestps.co.uk Contact: Jas Bola
- JDC IFA, Electroline House, 15 Lion Road Twickenham, Middlesex, TW1 4JH, 020 8755 5577 Adviser@jdcifa.com Contact: Martin Fairchild
Resident homeowners are welcome to call one of these advisers to discuss their personal circumstances. The Council will cover the cost of your initial consultation; you can contact all three, but you can only proceed with a consultation with just one; so you will need to choose.
The advisers will ask you a range of questions and offer advice based on your answers about your access to mortgage finance. This can be done over the telephone, by email or face to face. Their assessment and your financial circumstances will not be disclosed to the Council unless you ask for it to be. The adviser will contact us only to let us know that you have booked an assessment with them. While the Council has briefed these advisers, they are independent and the Council is not responsible for the advice provided or the actions you take based upon this advice.
If, having spoken to an adviser, you have identified that you would have difficulty in taking up any of the options then please contact the Estate Regeneration Team for a further discussion via:
Jacqueline Amma Thomas
T: 020 7926 3522
This is so that the Council can begin to gauge how many resident homeowners might be unable to take up these options and talk to you about your personal situation.
The Council will reimburse residents for all reasonable moving costs. This will mean that no-one should l be out of pocket for moving home. The Council will compensate resident homeowners for making them move home. This Home loss payment is 10% of the current value of their property - up to a limit of £53,000 (as at October 2015).
People who need extra support
The Council will provide additional support for vulnerable homeowners to help them through the process.
Recent Right to Buy purchases
Where a homeowner has bought their property through the Right To Buy process within the last three years, then they will not need to pay back the RTB discount. If a resident has special requirements for housing – such as wheelchair suitable accommodation, these can be considered if they remain on the estate.
Estimated values for your estate
Please pick your estate and housing type and press calculate to get the estimated figure.
Please note: These values set out above are NOT based on any detailed analysis of individual homes. The values are generic and are provided for information only. The date of valuation was March 2015 for estates except Cressingham. On Cressingham the valuation was conducted in November 2014.