Inheriting an Older Persons Shared Ownership (OPSO) home; how does it work? Womble Bond Dickinson‘s legal experts answer queries from people who’ve inherited OPSO Extra Care properties.
Legal firm, Womble Bond Dickinson (WBD), explained the basics when it comes to inheritance planning and bereavement in Part One of this two-part feature. Here they respond to some specific questions from people who are encountering challenges.
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If an inherited Older Persons Shared Ownership (OPSO) property is not selling, can ongoing service charges be waived or suspended?
You state that you are being charged: “full service fees, including buildings insurance for which there is no cover as the property remains empty”.
However, unless specifically agreed with your landlord, the terms of lease – including service charges rent and buildings insurance – are all still chargeable, and payment can be enforced against the estate.
There is no general legal rule that service charges stop because:
- an owner has died
- the property is vacant, or
- the property is on the market and unsold.
I am an executor and beneficiary on a will that leaves us a 25% share. We can’t sell it because it has a 61-year lease. I’m worried about what happens when the estate’s money runs out when it comes to paying the bills. Will the beneficiaries become liable?
Beneficiaries do not automatically become personally liable for the estate bills when the estate runs out of money. When the estate money runs out, the estate will continue to own the leasehold interest. If nothing is done, the charges will continue to accrue and the estate will become technically insolvent.
Creditors of the estate (including the landlord / management company) will be able to claim against the estate, not the beneficiaries personally, save for circumstances where the conduct of the beneficiary may result in personal liability. This includes
- accepting an assignment (transfer) of the lease
- distributing assets incorrectly, or
- expressly assuming liability.
We note the current lease term is 61 years. A term of this length is not usually mortgageable. You may wish to consider contacting the landlord to discuss extending the terms of the lease to make this more marketable.
There is also an option for the estate to disclaim the property. But this will only be available in certain circumstances. We would recommend taking legal advice to ascertain what options are available.
The above is distinct from a situation where you have accepted an assignment of the lease.
What is assignment? In simple terms, assignment refers to sale of a lease. It is the formal legal process by which the tenant transfers their leasehold interest to someone else.
In this case you would take on the financial obligations under the lease including payment of all rents and other charges under the lease.
If an estate runs out of money to pay housing costs (rent, service charges, etc) on an inherited Older Persons Shared Ownership (OPSO) home that the executors can’t sell, how and when do they declare the estate bankrupt?
An estate is not ‘declared bankrupt’ in the same way as an individual.
An estate becomes an insolvent estate when the assets of that estate are insufficient to meet its liabilities and there is no prospect of meeting the liabilities.
Once insolvency is apparent, the estate must be administered either by the executor under the insolvency principles, or under a court supervised insolvency administration order (IAO).
Debts must be paid to creditors in a certain order of priority, and any failure to do so may put you in a situation where you could become personally liable.
The law around insolvency of an estate and distribution of assets is complex. We would advise seeking legal advice if you believe the estate is insolvent to protect your position.
Can I sell the 25% share at a giveaway nominal price just to get rid of the flat?
No. In most cases, the share must be sold at its current market value, determined by a professional RICS valuer.
Where can I advertise the 25% share? (The usual portals for selling shared ownership homes don’t seem the right place for selling OPSO Extra Care homes)
In most cases, the lease requires the property to be offered to the housing provider first. During the nomination period, the provider has the exclusive right to market the property to eligible buyers.
If no buyer is found, the property can usually be marketed more widely, including through estate agents and specialist shared ownership or retirement platforms.
Some places to advertise the property include:
- The original housing association / landlord: Under most shared ownership leases, you must first offer the share back to the landlord (e.g., Housing 21, Anchor, or Your Housing Group).
- Specialised portals: Websites like MovingSoon list over-55 shared ownership properties.
- Retirement property agents: Specialised estate agents who deal with retirement living, such as McCarthy Stone for their own developments
Please note that any buyer must meet the scheme’s eligibility criteria.
What options do executors have if local councils impose double or triple council tax charges on empty shared ownership properties?
In most cases, there is an initial exemption followed by potential liability and premiums. Under legislation (Council Tax (Exempt Dwellings) Order 1992; Local Government Finance Act 1992), a property which is empty following death will usually qualify for a Class F exemption until probate is granted and for a limited period afterwards.
After that period, council tax becomes payable. Local authorities can then apply empty property premiums, which increase the charge where a property remains unoccupied for a prolonged period
Executors should check whether exemptions or discounts apply, particularly if the property is being actively marketed or if major repairs are being carried out. Local authorities also have discretion to reduce council tax in certain circumstances, and this can be applied for under Section 13A(1)(c) of the Local Government Finance Act 1992.
Disputes can be referred to the Valuation Tribunal.
What is the Valuation Tribunal? The Valuation Tribunal is an independent judicial body, which provides dispute resolution for council tax and business rates.
What are exit fees / event fees in Older Persons Shared Ownership (OPSO) schemes?
Exit fees (or event fees) are charges set out in the lease that become payable when certain events occur, most commonly on sale or transfer. They are commonly used in retirement housing to fund communal facilities, services and long-term maintenance and are usually deducted from the sale proceeds.
They may be calculated as a percentage of the sale price or based on the length of occupation.
Do all Older Persons Shared Ownership (OPSO) providers charge exit fees / event fees?
No. There is no requirement for all OPSO providers to charge these fees. However, they are common in modern retirement schemes.
Are there any caps on exit fees / event fees? Our understanding is that clauses in the lease should not be ‘onerous’ or ‘escalating’. These clauses from our lease appear to be both.
You state that, in your case, the lease requires:
“1% of the greater of either the consideration received by the Tenant for the transfer of the Lease or 75% of the Open Market Value of the Property at the completion date of such disposal of this Lease” AND “a sum equivalent to 0.75% multiplied by the number of complete years that the transferor has been the Tenant for the transfer of the Lease or the Open Market Value of the Property at the completion date of such disposal of this Lease.”
There is no statutory cap on exit or event fees in the UK. The amount payable will ultimately depend on the terms of the lease, subject to consumer protection law.
If a fee appears excessive or unclear, there are a few options that a shared owner can consider:
- Obtaining advice from the Leasehold Advisory Service (LEASE)
- It may be possible for a shared owner to challenge the fee through the Housing Ombudsman, particularly if they were not informed of the fee during the purchase or if the fee was not clearly explained. In some cases, this can be escalated to the First-tier Tribunal (Property Chamber).
- Many retirement housing providers are members of ARCO (Associated Retirement Community Operators), which has its own Consumer Code and independent grievance procedures. The Code sets standards for how complaints should be dealt with. If a complaint cannot be resolved internally, the provider must refer the matter to an independent Ombudsman scheme.
ARCO’s Code says: ‘consumers with a complaint under the Code can now seek independent redress from the Property Ombudsman, if the IRC operator is unable to resolve their complaint’. But does the Property Ombudsman have jurisdiction when it comes to people inheriting OPSO homes, given the Housing Ombudsman is generally responsible for shared ownership?
ARCO’s complaints guidance confirms that where a complaint relates to compliance with the ARCO Consumer Code, unresolved complaints are escalated to The Property Ombudsman (TPO), as the approved Alternative Dispute Resolution (ADR) scheme for the Code. This applies regardless of whether the property is OPSO or shared ownership. However, this does not mean TPO will always have jurisdiction in inherited OPSO cases.
The Housing Ombudsman generally deals with shared ownership matters. However, its published guidance on accepting complaints from people who “succeed to a tenancy” is framed around legal tenancy succession and occupation rights, It does not clearly extend to beneficiaries, executors or administrators who do not acquire a right to remain in the property.
As a result, jurisdiction is not settled by tenure alone and is fact‑dependent. In practice, whether the Housing Ombudsman or the Property Ombudsman is appropriate will depend on the provider, the complainant’s legal status, and the nature of the complaint. Providers are usually best placed to confirm which Ombudsman scheme applies in a particular case.
We are extremely grateful for the support of Places for People and Womble Bond Dickinson in creating this content.
DISCLAIMER: The information provided on this website is for general purposes only. It is not intended to be a substitute for legal, financial, tax or other professional advice. Everyone’s situation is different so always seek expert advice on any questions you may have.
Featured image: wayhomestudio on Freepik
Additional Resources
GOV.UK – Older Persons Shared Ownership (OPSO)
ARCO (Associated Retirement Community Operators) – Consumer Code
All-Party Parliamentary Group on Housing and Care for Older People – Making retirement living affordable: the role of shared ownership housing for older people
Law Commission – Event fees in retirement properties (2017)
Shared Ownership Resources – SO and bereavement: Q&A with WBD legal experts
Shared Ownership Resources – My SO Home: No. 35
Shared Ownership Resources – My SO Home: No. 34
Shared Ownership Resources – My SO Home: No. 32
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