Approved housing bodies (AHBs) are organisations approved under section 6 of the Housing (Miscellaneous Provisions) Act 1992 to provide social housing support in conjunction with local authorities. Since the late 1980s, close to 25,000 units of accommodation have been provided under capital funding schemes underpinned by 20 and 30 year mortgages. More recently, a scheme was introduced that provides an up-front capital payment of up to 30% of the property value to facilitate AHBs in raising private finance to acquire or build new social housing units. The capital advanced is repayable at the end of a payment and availability agreement, usually after 30 years.
Under the terms of these various funding schemes, AHBs are the de facto owners of the properties and are required to make them available for social renting for the duration of the mortgage or, as the case may be, the availability agreement. My Department cannot unilaterally make provision for their sale to tenants. Any such decision would have to involve the AHB and have regard to the mortgage on the property. On expiry of the mortgage period and subject to compliance with the terms of the funding agreement, the AHB becomes the owner of the property.
In relation to a regulatory framework for the sector, Building for the Future, a Voluntary Regulation Code was introduced in July 2013 as a precursor to a statutory regulatory framework to support the sector's long-term growth. In February 2014, I appointed an interim Regulatory Committee (iRC) to oversee the implementation of the voluntary code and to advise on the development of statutory regulation.
Regulation is an important element in providing the conditions necessary for the growth and development of the sector. Financing that growth is equally important and the question of how best to utilise the existing asset base, including the option of selling existing stock to tenants, is a factor to be considered.