Policy
Entitlement
Background
Business Rules
Appealing Decisions or Actions
Policy
To assist public housing tenants transition into home ownership the Department encourages the sale of existing housing to public housing tenants. Alternately, we sometimes sell dwellings or other assets on the private market. We use the money raised to fund the building of new homes and improvements to existing ones.
The Department particularly encourages the sale of properties to public housing tenants if they are in an area of high concentration of social housing, for example if they are in a public housing estate or are part of a Community Renewal Strategy.
The Department may also sell property for the following reasons. The properties:
- Are uneconomical to maintain or repair
- Have a high market value without a high strategic value
- No longer suit the demand in the area
- Are leased to a commercial enterprise
- Are leased to community organisations.
In areas of major development the Department may designate a specific sales or marketing strategy to secure value for money, such as public auction or sale by tender.
For more information on this policy, look in Entitlement, Background and Business Rules.
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Entitlement
Public Housing tenants can apply to buy their homes. While the Department is under no obligation to sell the property to the tenant, it will generally sell tenanted properties that:
- Are affordable to tenants;
- Are separately titled;
- Are being subdivided as part of a Community Renewal Strategy; or
- Providing the property is not required for future redevelopment or does not form part of a wider area sales plan.
Tenants of the Department of Housing are exempt from paying Stamp Duty on the sale and mortgage if they are purchasing at least a 25% interest in a property. This applies whether they are buying a home from the Department or on the open market, provided that this property will be the tenant's principle place of residence.
Public housing tenants are advised to contact the Home Purchase Advisory Service on telephone Freecall 1800 806 653 for information and advice regarding home purchase and any other assistance which may be available to home purchasers. They may be eligible for a $7000 grant under the First Home Owners Grant Scheme.
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Background
The Department takes into account the ability of the public housing tenant to obtain affordable finance, the type of title, the concentration of social housing in the area and the most appropriate sales method to secure value for money when deciding on the sale of a property.
We can only sell properties with individual title.
The following types of dwellings cannot be sold:
- Dwellings that are part of the Public Equity Partnership program.
- Headleased properties (leased by the Department and sub-let to public housing tenants. See the policy on Headleasing (EST0012A).
- Individual cottages, villas, townhouses, walk-up apartments, or pensioner units without separate title. We may subdivide each unit into Torrens Strata Titles as part of a Community Renewal Strategy or if we are selling the whole complex.
- Individual ‘Super lot’ properties. Super lots are large parcels of land with a number of dwellings without separate title to each dwelling. The Department can only sell such dwellings separately if they have a separate title.
- Properties that are required for future re-development, or may form an integral part of a future redevelopment site, such that sales may reduce future redevelopment potential, and
- Properties that cannot be replaced such as those suitable for disabled modifications, properties in high demand areas or properties in areas of high capital appreciation.
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Business Rules
Sales to Tenants
Public housing tenants may apply to the Department to sell them the home they are living in. We will generally approve the sale if it is not excluded through the above circumstances.
We will usually sell by private treaty. Properties are offered to public housing tenants at market value LESS the value added by approved improvements made by the tenant. No deduction is made for rent they have already paid. Tenants continue to pay rent until settlement.
When we receive an application from a public housing tenant to purchase their property, we will do no further maintenance to the property apart from essential and urgent repairs.
Public Housing tenants wanting to buy a property must:
- Organise their own finance and conveyancing on the sale;
- Pay $220 (GST Inclusive) to us to help pay for valuing of the home; and
- Obtain a letter from a lending authority showing they can get funds to make a purchase.
We will provide a site survey to ensure the correct property is being sold.
If we cannot sell the home we will refund the $220 (GST Inclusive) valuation fee. If it is agreed to sell, we will tell the tenant the sale price. If the tenant does not proceed with the sale within 14 days, they will forfeit the valuation fee.
In areas of major development we may designate a specific sales or marketing strategy other than private treaty, to secure value for money. This could include public auction or tender. When this occurs our local Department office will document the specific sales approach. This document will be made available to the tenant and other prospective buyers or their agents.
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Public Sales
Vacant homes may be sold to members of the public if the homes are no longer suitable for public housing. We may also sell community and commercial properties that we own from time to time.
Sales to the public are by public auction through a real estate agent. Agents are chosen by competitive tender. Private treaty (one to one) sales are only considered in exceptional circumstances and need the approval of the Director-General.
If the auction fails to reach the reserve price, the agent will try to find a purchaser and continue the sale by private treaty. The Director-General’s approval is not required in this case.
There will be no family connection or business association between the purchaser and the member of staff who approved the sale.
Where properties are leased to community organisations for use as neighbourhood facilities or supported accommodation, they may be offered for sale to the relevant community group. Sale prices may be the subject of negotiations with the organisation and will be dependent on both market value and past improvements funded by the group.
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Property owned by the Aboriginal Housing Office
The Department manages properties on behalf of the Aboriginal Housing Office. The Department must obtain prior approval from the Aboriginal Housing Office to sell a block of land or a dwelling owned by the Aboriginal Housing Office or demolish a property owned by the Aboriginal Housing Office. See policy on Aboriginal People and Housing Assistance (ALL0030B).
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Appealing Decisions or Actions
If a client disagrees with a decision the Department has made, they should first discuss their concerns with a Client Service Officer. The next step if they still believe we made the wrong decision is to ask for a formal review of the decision. For information on how reviews work, the client can ask the Client Service Officer for a copy of the fact sheet ‘Reviewing Decisions’, or go to our web site www.housing.nsw.gov.au to read the Appeals and Review of Decisions Policy.
A decision not to sell a home cannot be referred to the Housing Appeals Committee.
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