The Enhanced Leasing Scheme was introduced in 2018 in order to encourage social housing leasing at a reasonable scale in order to supplement social housing delivery under other programmes. All potential proposals are submitted by the proposers to the Housing Agency for initial assessment and co-ordination with local authorities. The proposal is then submitted to my Department for approval.
Under the scheme, the relevant housing authority is the landlord to the social housing tenant - nominated in accordance with their Scheme of Letting Priorities - and must ensure the Lessor discharges their obligations under the lease, including the delivery of management services in a manner consistent with the terms of the agreement. The enhanced leasing agreement is a performance-based contract where deductions apply to the rent if the management services requirements are not adequately performed. Prior to an enhanced lease commencing, the housing authority and the Lessor agree a Management Plan for the scheme to ensure efficient housing management services are delivered to tenants in line with the terms of the agreement.
Lease payments are paid to the property owner based on a discounted market rent, with the level of discount reflecting the maintenance responsibilities taken on by the owner. The maximum lease term is 25 years and rents are reviewed every 3 years linked to the Harmonised Index of Consumer Prices (HICP). All enhanced leasing proposals submitted to my Department must be accompanied by an independent valuation of the market rent for the properties, carried out by, or commissioned and paid for by, the relevant local authority.
The role of the Housing Agency is to assist housing authorities and my Department with the administration of the scheme. As part of the due diligence process for Enhanced Leasing, the Housing Agency engages with the National Development Finance Agency (NDFA) and legal advisors, as required, to assess the ability of the proposed leasing entity to deliver the proposed dwellings and to provide the property maintenance services required. The Lessor’s legal status, funding position and operational structure are assessed as part of this process.
The Agency liaises with the housing authority throughout the process to ensure that all required documentation is provided by the Lessor. Prospective Lessors are also subject to assessment by the solicitors acting on behalf of the housing authority.
While the Housing Agency acts as a national coordinator for the scheme, housing authorities retain their responsibilities in relation to social housing provision; assessment of social housing need and suitability, and tenancy management. At end 2020, a total of 113 Enhanced Leasing arrangements had been entered into by housing authorities.
