{
  "url": "https://openlegislation.uk/local-authorities-capital-finance-regulations-1997/regulation-104",
  "json_url": "https://openlegislation.uk/local-authorities-capital-finance-regulations-1997/regulation-104.json",
  "legislation": "uksi/1997/319",
  "legislation_title": "The Local Authorities (Capital Finance) Regulations 1997",
  "legislation_url": "https://openlegislation.uk/local-authorities-capital-finance-regulations-1997",
  "path": "regulation/104",
  "kind": "regulation",
  "number": "104",
  "heading": "Disposals of dwellings in exchange for certain flats",
  "text": "(1) In this regulation—\n“flat” has the same meaning as in section 183 of the Housing Act 1985 (“the 1985 Act”);\n“former tenant” means a person to whom a qualifying lease was granted, or a person who has succeeded to the lessee’s interest under a qualifying lease by virtue of a disposal of a description falling within paragraph (a), (b) or (c) of subsection (1) of section 160 of the 1985 Act (disposals exempt from requirement to repay discount);\n“lending institution” means an institution which is an approved lending institution for the purposes of section 156 of the 1985 Act; and\n“qualifying lease” means a lease of a flat granted by a local authority pursuant to Part V of the 1985 Act (the right to buy), or with the consent of the Secretary of State under section 32 or 43 of that Act and the benefit of a discount of not less than 44 per cent.\n(2) Capital receipts of a description specified in paragraph (3) shall be treated for the purposes only of section 59 as reduced by an amount determined in accordance with paragraph (4).\n(3) For the purposes of paragraph (2), capital receipts derived from a disposal of an interest in a dwelling to a former tenant are specified where—\n(a) immediately before the disposal, the former tenant occupied the flat demised by his qualifying lease (“the flat”) as his only or principal home;\n(b) the authority granted the qualifying lease not less than three years before the date of the disposal;\n(c) the authority make the disposal by conveying the freehold interest in the dwelling, granting a lease for a term of not less than 99 years, or assigning their entire leasehold interest in the dwelling;\n(d) if the interest disposed of is a lease, the authority estimate that not less than 90 per cent. of the capital value of the lease has been, or is to be, received by them within one year after the date of the disposal;\n(e) the consideration received by the authority for the disposal includes the assignment or surrender to them of the qualifying lease;\n(f) upon such assignment or surrender there is attributed, as part of the consideration for the disposal, an amount equal to the price paid on the grant of the qualifying lease; and\n(g) the authority is satisfied that any person wishing to buy the qualifying lease would be unlikely, for reasons which do not relate to the personal or financial status of that person, or the terms of that lease, or the condition of the flat or the building in which the flat is situated, to obtain from a lending institution an advance—\n(i) secured by a mortgage of the qualifying lease for a term of twenty-five years, and\n(ii) of an amount equal to 75 per cent. of the value of that lease determined not more than three months before the date of the disposal in accordance with paragraph (5).\n(4) For the purposes of pargraph (2), the amount of the reduction is the aggregate of—\n(a) an amount equal to the price paid on the grant of the qualifying lease; and\n(b) the amount of any costs incurred by the authority in connection with the disposal and the surrender or assignment of the qualifying lease.\n(5) For the purposes of paragraph (3)(g), the value of the qualifying lease shall be determined by an approved surveyor on the basis that it is the price which that lease would realise at the date of the valuation if sold on the open market by a willing vendor on the assumption that—\n(a) the vendor was selling with vacant possession;\n(b) the purchaser was purchasing the lease for the purposes of owner occupation; and\n(c) the criteria applied by lending institutions for the assessment of mortgage applications, so far as they relate to the number of storeys in the building in which a dwelling is situated or the number of dwellings in the building which are occupied by owners, are not applicable to the flat or any other flat in the same building.\n(6) A surveyor is approved for the purposes of paragraph (5) if he has ability in, and experience of, the valuation of dwellings of the same kind, and in the same area, as the flat, and is—\n(a) a fellow or professional associate of the Royal Institution of Chartered Surveyors or of the Incorporated Society of Valuers and Auctioneers; or\n(b) a person who satisfies such other requirement or requirements as may be prescribed by regulations made under section 13(7) of the Leasehold Reform, Housing and Urban Development Act 1993.",
  "extent": "E+W",
  "status": "prospective",
  "version": "current",
  "annotations": [
    {
      "type": "I",
      "label": "I1",
      "text": "Reg. 104 in force at 1.4.1997, see reg. 1(1)(b)"
    },
    {
      "type": "footnote",
      "label": "f1",
      "text": "1985 c. 68."
    },
    {
      "type": "footnote",
      "label": "f2",
      "text": "1993 c. 28. See the Collective Enfranchisement and Tenants' Audit (Qualified Surveyors) Regulations 1994 (S.I. 1994/1263)."
    }
  ],
  "outstanding_effects": [
    {
      "type": "coming into force",
      "affecting": "uksi/1997/319",
      "affecting_title": "The Local Authorities (Capital Finance) Regulations 1997"
    },
    {
      "type": "amended",
      "affecting": "uksi/1999/501",
      "affecting_title": "The Local Authorities (Capital Finance) (Amendment) Regulations 1999"
    }
  ],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/uksi/1997/319/regulation/104",
    "retrieved_at": "2026-10-29T12:25:41.411541+00:00"
  },
  "licence": "Open Government Licence v3.0",
  "licence_url": "https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/",
  "attribution": "Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives."
}