Harefield Gazette - - PROPERTY -

Ascheme to en­cour­age house build­ing for lower in­come house­holds was an­nounced re­cently by Eric Pick­les, the com­mu­ni­ties sec­re­tar y.

Hous­ing as­so­ci­a­tions and so­cial land­lords will be given £400mil­lion wor th of cheap loans to build homes un­der a Rent to Buy scheme, whereby they will have to rent the houses at be­low-mar­ket rates – capped at 80 per cent of lo­cal mar­ket value – for seven years. At the end of this pe­riod, peo­ple will be given the op­por tu­nity to buy the homes.The gov­ern­ment claims that 10,000 new homes will be built be­tween 2015 and 2017.

The pol­icy is aimed at young peo­ple tr ying to build up a de­posit to get on the hous­ing lad­der rather than those on ben­e­fits.

Eric Pick­les pointed out that cur­rent schemes, in­clud­ing the Help to Buy scheme, have boosted house build­ing. At the star t of Septem­ber, 48,393 homes had been bought through the Help to Buy eq­uity loan scheme, with 82 per sales of house sales go­ing to first-time buy­ers.

“Both house build­ing and the num­ber of first-time buy­ers are now at their high­est rate since 2007,” he said.

“As par t of our wider hous­ing pro­gramme, this new scheme will help in­crease the pro­vi­sion of low-cost rented ac­com­mo­da­tion and pro­vide a spring­board for young peo­ple to up­grade to home own­er­ship.”

To qual­ify, the house­hold in­come must be less than £66,000 a year – or £64,300 if look­ing at homes in London – based on two peo­ple earn­ing £33,000 each. Hous­ing as­so­ci­a­tions will have up to 16 years to pay back the low-cost loans and, un­til the loans are re­paid, the homes must be made avail­able for af­ford­able rent.

As with many schemes, the avail­abil­ity and the terms can var y be­tween hous­ing as­so­ci­a­tions – as can the names, such as Tr y Be­fore You Buy, Rent Save Buy, Rent to Save – and the de­tails need to be checked ac­cord­ingly.

Should you con­sider sign­ing up – and even­tu­ally buy­ing the proper ty – it is al­ways wor th check­ing with an in­de­pen­dent mor tgage ad­viser first and price up how much this would cost in monthly re­pay­ments. You should also ask whether they are happy to lend against proper ties within the Rent to Buy schemes and to fac­tor in the costs of buy­ing a home too.

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