Whether you are a first time buyer, council or housing association tenant or key worker there is a range of government schemes to help you get your foot on the property ladder.
Who is eligible for government schemes?
There are many different ways you can get help buying a home if you cannot afford to buy. Each individual scheme will have its own criteria – so check the details of each scheme with your landlord or the relevant HomeBuy Agent.
You may be eligible for low cost housingif you are a:
- council tenant
- housing association tenant
- key worker (e.g. teacher or police officer)
- first time buyer who can't afford to buy a property, as identified by the Regional Housing Board as a priority case forlow cost home ownership.
Demand for these schemes is high and some local councils and housing associations may limit the scheme to those who are on their housing lists. The different schemes are listed below:
Discounted Housing
Offered by social (council and housing association tenants) landlords, these give their tenants the chance to buy their rented home outright at a discount, which is calculated according to where you live.
The two main discount schemes are ‘Right to Buy' for council tenants and ‘Right to Acquire' for housing associations tenants.
Cash incentives
Your council may also run a cash incentive scheme where they offer you money to move to a smaller property, so that they can use the space to house other people on their waiting lists.
The details of the scheme vary from council to council, and not all councils offer the scheme. To find out more, contact the housing department of your local council.
Shared equity (Open Market HomeBuy)
This is a loan where the lender shares in any rise (and sometimes any fall) in the value of the property over the course of the loan.
These are schemes where the landlord or a bank or building society lends you money for part of the cost of your mortgage. You may have to pay interest on the amount you owe but it is limited to a fixed rate set by the lender.
The Government also offers a 17.5% Government Equity Loan (capped at £50,000) which purchasers will be able to use in conjunction with a mortgage from any lender. Contact your local HomeBuy Agent.
This scheme may be for you if you are able to meet most of the costs of buying a home.
Shared Ownership 1 ( Social HomeBuy)
This scheme allows existing tenants of local councils and housing associations to buy a share in their current home at a discount
Shared Ownership 2 (New Build HomeBuy )
HomeBuy is sometimes also called shared ownership or shared equity. It gives you help to buy a share of a home and pay a fee for the remainder, letting you get onto the property ladder.
Your monthly outgoings will include repayments on any mortgage you have taken out, plus a monthly charge on the part of the property kept by the landlord. With the shared ownership scheme, when you can afford it, you can increase your share until you own the whole property. The purchase of further shares is based on the current market value of the property, whether it has gone up or down. This is sometimes called ‘staircasing'. (This includes the First-Time Buyers Initiative which uses public sector land).
English Partnerships and The First Time Buyer's Initiative
The First Time Buyers' Initiative (FTBI) aims to give more people the opportunity to own their own home by increasing the supply of affordable housing for sale. It is being delivered through English Partnerships, the national regeneration agency.
It is a shared equity scheme that aims to help eligible first-time buyers buy a share in a new home. They must buy at least half of the property and English Partnerships will retain the rest. After living in the home for three years, buyers will pay a charge to English Partnerships based on a percentage of the equity they don't own.
Useful Websites: