Lawyers that specialise in the social housing sector act for registered providers and registered social landlords across England and Wales including housing associations (usually not for profit organisations), local authorities and arms-length management organisations (ALMOs).
Social housing is designed to provide more affordable housing than private renting. A social housing tenant will rent their home from a housing association or council (who will be their landlord) on a secure tenancy at a rent below market rate. The purpose of this type of housing is to provide homes to those who are most in need or struggling with their housing costs.
The reason social housing tends to have its own specialist sector at a law firm is largely due to the specific regulation that applies to social housing providers and the unique processes that they must follow.
Regulator of Social Housing
The Regulator of Social Housing (RSH) regulates registered providers of social housing.
The RSH focuses on governance, financial viability and value for money as well as consumer standards. The RSH sets out specific regulatory expectations and outcomes that providers are expected to achieve. The RSH will rate each social housing provider and the rating will indicate how well a social housing provider is doing against the expectations of the RSH.
The RSH expects social housing providers to be proactive in identifying issues and taking actions to resolve those issues. If a provider is not taking effective action or there's a need for more urgent action, the regulator may need to consider using their invention and enforcement powers.
Areas of law within Social Housing
Banking and securitisation - social housing providers need money (usually to build more housing). As such, providers will look to a variety of lenders for funding arrangements such as traditional loan agreements (bilateral and syndicated facilities), private placements and various forms of 'bonds'. These loans/bonds will be 'secured' - this means assets of the borrower will be used as security for the loan so that if the borrower defaulted on the loan, the lender would take the assets and sell them to pay off the loan. Social housing providers will usually use their existing housing stock as security for these loans.
In addition to the banking team who will arrange the actual loan/bond agreements and arrangements, there'll also be a 'property charging team' or 'securitisation team' or 'real estate finance team' (all different names but the work of the team is the same). Essentially this team will do the 'due diligence' work on the housing stock of the borrower to make sure it is valuable security (i.e. if a borrower is taking out a loan of £1m, are the homes being used as security actually work £1m?).
Property and development - most of the business of a social housing provider (other than renting and selling low cost homes) is actually buying land and building homes on that land. When a developer buy land to build homes, a number of planning issues will arise such as the need to enter into 's106 agreements' or comply with restrictive planning conditions on planning permission such as needing to have a certain percentage of the homes being built as social housing homes. The developer will then enter into agreements with social housing providers to sell those homes to them so that they can offer them to tenants at low cost (thereby complying with the planning restrictions). Lawyers in this area will have that specialist knowledge and draft appropriate development agreements, joint ventures, collaboration, grant and funding agreements and housing regeneration schemes.
In addition to the development side there'll also be 'plots' side. This is where individual plots on the development (i.e. homes) are sold through shared ownership schemes, help to buy or discounted open market sales. Additional social housing specific property transactions also include 'staircasing' (that's where a shared owner buys another chunk in the property), 'share resales' (shared owner sells their share of the property to someone else), right to buy, right to acquire, leasehold enfranchisements and lease extensions.
Housing Management and Housing Litigation - the tenancy agreements for social housing properties tend to be specialist and therefore lawyers with housing management experience is a must - someone able to advise and interpret the tenancy agreements and ensure that the tenancy agreements complies with all housing regulation and law. Additionally, there'll be specific contentious areas of housing management which will require litigation lawyers - issues include adverse possession claims, anti-social behaviour issues, section 20 consultations, commercial property issues, renewing commercial leases etc.
Housing corporate and governance - due to the regulation of social housing providers, the governance and corporate structures in place differ significantly from traditional commercial organisations and as such specialist corporate housing lawyers will be required. Corporate housing lawyers will have industry knowledge of the sector and be able advise on mergers and acquisitions of housing associations, governance restructures and a range of other corporate issues.