Introduction
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Affordable housing schemes have been created and backed by the government to help people who can’t afford to buy a home on the open market to get on to the property ladder. The schemes are normally operated through Housing Associations or Registered Social Landlords and vary in the share of ownership and amount of up front money you need.
This should not be confused with sheltered housing. You will own an affordable part of your home which over time can be converted to 100% when your situation changes.
What is affordable housing
The government has recognised that the average age of a first time buyer is increasing and the affordability gap is continually increasing. With more people being forced to rent and having to delay getting onto the property ladder longer, the government has stepped in and created initiatives to generate affordable housing. Planning authorities are now forcing developers to incorporate affordable homes in all schemes above a certain size with an allocation of anywhere between 10% and 50% of the development. The units are compulsory sold to a Housing Association at a heavily discounted and affordable price. The Housing Associations have large portfolios of properties across a number of areas and developments with the primary role to assist people who satisfy the criteria to get onto the property ladder.
There are normally strict criteria about who they can sell to and everyone has to fill in an Application form to register their interest. If they receive lots of applications then they would typically give priority based on need:
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Tenants of either a local authority or a housing association
- First time buyers
- Those in unsuitable existing housing circumstances
- People able to afford shared ownership but unable to buy a home on the open market
- ‘Key Workers’ – people moving to the area to take up a job opportunity
- Those requiring a home following a relationship breakdown
The government has also established funding schemes which are not delivered through Housing associations and allows first time buyers to take shared equity in private homes sales.
Schemes Operated by the Government
Home Buy (Previously shared equity) - This will enable you to buy a share in a newly built property of at least 25%. A rent of up to a maximum of 3% will be paid on the share you do not own. See property developers web sites or Housing Association offers.
Open Market Home Buy – The scheme provides access to additional money called equity loans, which run alongside a conventional mortgage loan. Two equity loans, each worth around 12.5% of the value of your home, are provided at 0% for 5 Years. The first is provided by the same lender that you select to provide your conventional mortgage loan; and the second is provided by the Government through a HomeBuy Agent (Housing Association).
First Time Buyer Initiative - The First Time Buyers’ Initiative (FTBI) aims to make more affordable homes available to first-time buyers priced out of the housing market.
Find a Housing Association in your area.
We have prepared a list of Housing Associations in the Greater Manchester Area which are listed in each of the 10 boroughs. If you have a general enquiry in the Greater Manchester area the 3 main Housing Associations to contact are Plumb Life, Housing Corporation and Space.
Schemes with affordable housing. |
