Low-cost home ownership
Many people can't afford to buy a home on the open market. It can be an expensive commitment.
But there are some interesting new ways to help bring home-owning within reach. Most schemes are for households earning less than £60,000 a year who would otherwise be unable to buy.
HomeBuy Direct
You need to find just 70% of the purchase price (through savings or a mortgage). The rest is covered by an ‘equity loan’ that doesn’t need to be paid off until you sell the property; or you can pay some or all off sooner if you want.
New Build HomeBuy (shared ownership)
You buy a share of between 25% and 75% of a newly-built property through savings or a mortgage. You pay rent to a not-for-profit organisation on the remaining share.
Rent to HomeBuy
You can rent a newly-built property for up to five years at an affordable rent (80% or less than the market rent) while you save for a deposit on the home. You get the first option of buying it at the end of the rent period. You can then use the New Build HomeBuy scheme (see above) to buy.
First time buyers initiative
You need to find five per cent or more of the purchase price up front, and then buy additional shares every year until you own the home outright. You pay charges on the part of your home that you don't own – but nothing for the first three years. In year four, these charges are one percent of the part you don’t own, and go up to three per cent in year six.
Or go through a not-for-profit organisation called a home buy agent to see if you’re eligible for these schemes and to see what else is available. The agent for our area is called Plumlife.
Plumlife can also advise you about the other costs of buying a home - like legal fees, and taxes – and about the regular costs like paying the mortgage, repairs and service charges.
Home-owning could be for you – especially if you use one of these great low-cost schemes.