Structure of the Act Part 3 – Other Provisions Leasehold enfranchisement Section 302 - Shared ownership leases: protection for hard to replace houses
871.Section 302 inserts paragraph 4A into Schedule 4A to the 1967 Act. The effect of paragraph 4A is that shared ownership leases granted by any provider that are not excluded from the operation of Part 1 of the Act by virtue of either paragraph 3 or 3A of Schedule 4A (because they do not comply with the conditions set out in either of those paragraphs) will nevertheless be excluded from the operation of Part 1 if they are situated within an area that is designated as a protected area and if they satisfy all the other requirements set out in paragraph 4A. The appropriate national authority (i.e. the Secretary of State in England, and the Welsh Ministers in Wales) has power to prescribe additional conditions that must be satisfied.
872.The appropriate national authority is also given power under paragraph 4A to designate an area as a protected area where it considers it is appropriate to do so to support the provision in the area of houses, or types of houses, which are available for occupation in accordance with shared ownership arrangements. The appropriate national authority must publish the criteria which will be taken into account by it in deciding whether to designate an area as a protected area, and must consult those likely to be affected by the designation.
873.Subject to the conditions in paragraph 4A being satisfied, this provision will allow any provider of shared ownership housing to grant leases that restrict the percentage share of the house that the tenant may acquire, and may also prevent the tenant from acquiring the freehold interest, if the house is in an area that has been designated as a protected area.
874.This section is intended to help retain shared ownership properties as affordable housing for future purchasers in areas where such housing would be hard to replace. It is also intended to help to make land available for affordable housing by giving landowners greater assurance that the properties will be retained as affordable housing for future purchasers.