Committee Report Checklist
Stage 1
Report checklist – responsibility of report owner
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ITEM |
Yes / No |
Date |
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Councillor engagement / input from Chair prior to briefing |
No |
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Commissioner engagement (if report focused on issues of concern to Commissioners such as Finance, Assets etc) |
Yes |
17/10 |
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Relevant Group Head review |
N/A |
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MAT+ review (to have been circulated at least 5 working days before Stage 2) |
Yes |
17/10 |
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This item is on the Forward Plan for the relevant committee |
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Reviewed by |
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Finance comments |
TC |
Oct 25 |
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Risk comments |
Yes |
Oct 25 |
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Legal comments |
LH |
10/10/25 |
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HR comments (if applicable) |
N/a |
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For reports with material financial or legal implications the author should engage with the respective teams at the outset and receive input to their reports prior to asking for MO or s151 comments.
Do not forward to stage 2 unless all the above have been completed.
Stage 2
Report checklist – responsibility of report owner
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ITEM |
Completed by |
Date |
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Monitoring Officer commentary – at least 5 working days before MAT |
L Heron |
10/10/25 |
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S151 Officer commentary – at least 5 working days before MAT |
T.Collier |
28/9/25 |
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Confirm final report cleared by MAT |
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Title |
Occupation of Ashford Cemetery Lodge |
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Purpose of the report |
To make a decision |
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Report Author |
Coralie Holman, Group Head Assets |
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Ward(s) Affected |
Ashford |
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Exempt |
No |
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Exemption Reason |
Not Applicable |
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Corporate Priority |
Community, Addressing Housing Need & Resilience |
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Recommendations
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Committee is asked to: 1) Agree the Council undertake a direct letting of Ashford Cemetery Lodge. 2) Delegate authority to the Group Head of Corporate Governance to complete any necessary documentation in connection with the letting.
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Reason for Recommendation |
Ashford Cemetery Lodge has been fully refurbished at a cost of c.£188,000 of which £80,000, came from S.106 funding. The letting will allow the property to be used for affordable housing. |
1. Executive summary of the report
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What is the situation |
Why we want to do something |
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· Ashford Cemetery Lodge is the former Cemetery Manager’s house and has not been used for residential purposes for many years due to the poor internal condition but has now been extensively refurbished and now provides good quality accommodation offering up to 4 bedrooms for affordable housing accommodation. |
· Following the refurbishment the property is now ready for occupation as a family home. · It is not financially viable to transfer the property to Knowle Green Estates (KGE) at full value; hence it is recommended the Council let the property directly. |
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This is what we want to do about it |
These are the next steps |
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· The proposal is for the Council to undertake a direct letting, for use as affordable housing. |
· Subject to Committee agreement, to select a family using appropriate criteria to let the house to and complete appropriate legal documentation. |
2. Key issues
2.1 Ashford Cemetery Lodge forms part of Ashford Cemetery, being the former cemetery manager’s accommodation. The property was refurbished by the Council at a cost of c.£188,000 having previously been in poor and unhabitable condition. Refurbishment works have been extensive and included an internal reconfiguration from what was originally a dated 3-bedroom house with downstairs bathroom. The house now offers up to 4 bedrooms with both an upstairs and downstairs bathroom.
2.2 The refurbishment cost included S.106 funding (£80k) and the remainder an approved Council Capital Programme (funded from transferred revenue budget) forming part of the 2024/25 Capital works programme. As S.106 funding has been used this directs the property to be used for affordable housing, hence the property is not deemed suitable for market sale, unless the S.106 funding is repaid. The refurbishment was not undertaken based on commercial financial viability. Refurbishment was based on reutilising a surplus Council Asset to provide a rare, but much needed sustainable 4-bedroom family home, hence using S.106 funding.
2.3 The accommodation consists of 2 rooms plus a bathroom at first floor level and 3 further rooms plus a kitchen and bathroom on the ground floor. Refurbishment includes two new bathrooms, a newly fitted kitchen and driveway providing off road parking. The refurbishment focused on sustainability through installation new roof, new insulation (roof voids, floors & walls), new double glazed uPVC windows & doors, solar panels. An electric boiler was installed as a low carbon heating option to replace the existing gas boiler.
2.4 The Council has a substantial demand for affordable housing. At present (30/9/25), 95 families on the Housing Register need a property of this size, 40 of the families are in Band B (Urgent Need to Move). Affordable properties of 4-bedroom size are rarely available, which means that families stay on the register for a long period of time.
2.5 Historically, since 2018, the approach has been to transfer all Council owned residential property to Knowle Green Estates (KGE) (with the exception of Harper House and White House) at the appropriate financial level depending whether the property has been owned by the Council for alternative use, as is the case of the Lodge (being directly aligned to the Cemetery). In the case of previous alternative use, it had been deemed acceptable to transfer properties to KGE at costs less grants and contributions.
2.6 The Commissioner team queried the process of discounted intercompany disposals and have guided that alternative ways to facilitate use of the Lodge as a family home should be considered. As referred to in para 2.2 above if the property is disposed of then all S.106 funding would need to be re-paid. The options set out in section 3 of this report are therefore to sell the property to a Registered Provider of Housing, the Council directly let the accommodation or decide to sell the property on the open market, in which case it wouldn’t be used as affordable housing.
3. Options appraisal and proposal
3.1 Option 1 Sell the Property to a Registered Provider of Social Housing (RP) – this option is not recommended. If the Council disposes of the property, unless the parties agree to enter into a nomination’s agreement (which provides certainty for a fixed period only) it (and the successor unitary) will lose control over selection of a family to occupy the accommodation, which may mean the occupants were not a family on the Housing Register. In addition to sell the property is likely to result in a sale at less than market value as it is anticipated discounted affordable housing rents would not generate sufficient income to reach an asset value for an RP equal to market value.
3.2 Option 2 The Council undertake a direct letting of the Lodge to a family from the Council’s Housing Register – this is the recommended option. By directly letting the property the Council will retain direct control both in terms of selection of the occupant family and managing any adverse behaviour impacting the cemetery operation. The intention of utilising S.106 funding to refurbish the property as a 4-bedroom house was to provide a rare and greatly needed 4-bedroom home to assist with provision of this type of housing. Retaining ownership of the Lodge also ensures the Council is not disposing of a site at less than market value. The rental income would be £1975 per calendar month based on Local Housing Allowance rates with a net savings on the Homelessness budget of approximately £48k pa.
3.3 On the basis that availability of 4 bed properties is rare, the use of this accommodation could be as a general needs affordable settled home, or a Temporary Accommodation (TA). Use as general needs accommodation would result in the occupant family entering a secure lifetime tenancy, which in turn would provide them with a future ‘Right to Buy’ the accommodation. Risks around Right to buy are detailed within the risk section of this report. It is anticipated the property will be let as TA on a licence basis and this would not create a Right to Buy situation.
3.4 Option 3 Sell the Property on the Open Market – this option is not recommended.If the property was offered on the open it would probably only be considered suitable as a 2-bedroom house, due to 2 of the rooms that could be used as bedrooms being located on the ground floor. In January 2025 an external opinion of market value for the Lodge was obtained at £550,000. It is not considered pricing has altered significantly since this time. The property pre-refurbishment was held in the Council’s Asset Register with a value of £400,000, once refurbishment costs are added this produces a value of £588,000 which is more than the current market value. Therefore, a sale a market value would still result in write down of Asset value to cover both the over market value cost and repay S.106 funding. The Asset write down is anticipated to be c. £50,000 being the Council’s Asset value of £400,000 less net sales receipt of c. £350,000. This is set out in more detail within the financial implications section of this report.
4. Risk implications
4.1 Loss of management control which could adversely impact the cemetery use in respect of noise levels and other anti-social behaviour and the Council would have limited ability to address this if the property in independently owned.
4.2 Right to Buy. Under Housing legislation secure tenants (including flexible tenants) of Council owned properties have the right to buy, at a discount, the freehold or long leasehold interest in their homes if they fulfil certain conditions. Whilst the current Government proposes to make changes to the current right to buy scheme, there is still a long-term risk that the Council may lose its housing stock if conditions are met and the right exercised.
4.4 If the Council take retain ownership of the Lodge and let it, all statutory housing law will need to be complied with. However, as a newly refurbished property, concerns around the standard of accommodation for living purposes and compliance is not considered to be a concern. The management of the property would be undertaken by the same team who manage the KGE residential property, hence they understand the legislative requirements.
4.3 If the Lodge was disposed of at less than book value, this would result in the Council needing to reflect financial losses in its accounts and reserves as has been the situation with other (non-residential) asset disposals.
5. Legal comments
5.1 In addition to the general power of competence under section 1 of the Localism Act 2011, the Council has statutory powers to own, manage, let and allocate housing stock under the Housing Act 1985 and Housing Act 1996.
5.2 Part 5 of the Housing Act 1985 gives secure tenants the right to buy the freehold or long leasehold interest in their homes if they fulfil certain conditions.
5.3 Legal Team will assist in the preparation of the necessary documentation.
6. Financial Implications
6.1 Once all costs of improvement are deducted the net receipt would be less than the March 2023 £400k valuation, the option of disposal would not achieve best value. This is based on:
Sale price of £550,000
less S.106 costs £ 80,000
Refurb cost from capital £108,000
Disposal Fees (letting & legal) £ 10,750
Net Receipt £351,250
6.2 The Council has invested approximately £188,000 in refurbishing Ashford Cemetery Lodge, of which £80,000 was funded via S.106 developer contributions and the remainder through the Council’s approved Capital Programme. This funding arrangement imposes a legal requirement to use the property for affordable housing; any disposal outside this use would trigger repayment of the S.106 funding, materially reducing the financial benefit of a sale. This constraint directly impacts the financial viability of transferring the asset to Knowle Green Estates (KGE) or selling it on the open market.
6.3 A recent valuation (January 2025) suggests a market value of £550,000. However, once refurbishment costs and legal/disposal fees are deducted—and accounting for the need to repay the S.106 contribution, a market sale would yield a net receipt of approximately £351,250. This is below the pre-refurbishment asset book value of £400,000 and substantially less than the capitalised investment of £588,000, effectively resulting in a financial loss or write-down of around £50,000. Moreover, a sale to a Registered Provider (RP) is also financially unfavourable, as the nature of affordable rents would further depress the asset’s valuation, and the Council would lose long-term control over allocations.
6.4 In contrast, the proposed direct letting by the Council (Option 2) avoids any need to repay S.106 funding and ensures the asset is retained for affordable housing in line with planning obligations. This approach also provides a sustainable revenue stream, with expected rental income of £1,975 per calendar month based on Local Housing Allowance rates, supporting a long-term return on investment. Additionally, by retaining ownership, the Council maintains control over tenant selection and property management, which is critical given the property’s location within the cemetery grounds.
6.5 From a financial standpoint, Option 2 is the most prudent and strategically aligned choice. It avoids immediate capital losses, fulfils affordable housing commitments, and contributes to mitigating local housing need without compromising asset value or incurring additional liabilities. Future risks associated with Right to Buy are acknowledged but are outweighed by the wider benefits of retention and direct letting. The annual savings benefits impact on the Homelessness budget will be in the region of £48k pa.
6.6 The Ashford Cemetery Lodge has been extensively refurbished at a total cost of approximately £188,000, of which £80,000 was funded through S.106 contributions, and the remainder via the Council's capital programme. The use of S.106 funding legally restricts the property to be used for affordable housing, and any sale or disposal outside of this purpose would require repayment of the S.106 funding, effectively reducing the net return from a sale.
6.7 Option 2 – Direct Letting by the Council is the recommended and financially prudent route. It allows the Council to retain ownership of the asset, avoid any repayment of S.106 funding, and deliver on strategic housing priorities. It also ensures management control, which is important given the property’s location within a cemetery site. There are minimal additional financial implications under this option, beyond standard tenancy management costs.
6.8 Selling the property to a Registered Provider (Option 1) or on the open market (Option 3) presents less favourable financial outcomes. An open market sale is likely to achieve no more than £550,000, which is below the total capitalised cost (£588,000). After adjusting for S.106 repayment and potential disposal costs, the Council would likely face an asset write-down of approximately £50,000, representing poor value for money. A sale to a Registered Provider would likely also be at a discount to market value due to affordable rent restrictions, compounding financial loss.
Corporate implications
7. S151 Officer comments
7.1 The S151 Officer is supportive of the proposed option of retaining the asset on the Council’s Balance Sheet, this avoids any complication by any decisions taken about the future of KGE, and will provide an ongoing financial benefit by easing pressure on the Council’s homelessness budget
8. Monitoring Officer comments
8.1 The Monitoring Officer confirms that all relevant legal implications have been taken into account.
9. Procurement comments
9.1 There are no procurement implications directly arising from this report.
10. Equality and Diversity
10.1 Not Applicable
11. Sustainability/Climate Change Implications
11.1 The letting of the Ashford Cemetery Lodge would move the lodge from the Council’s operational scope 1+2 carbon footprint, to the council’s downstream scope 3 carbon footprint. Therefore, although the operational carbon footprint will be marginally reduced, the scope 3 carbon footprint would increase as the property would be back in a fully utilised state.
12. Other considerations
12.1 None
13. Timetable for implementation
13.1 As soon as possible
Contact Coralie Holman – Group Head Assets
Please submit any material questions to the Committee Chair and Officer Contact by two days in advance of the meeting.
Background papers: None.
Appendices: None