Affordable housing schemes
Last Updated: 5 October 2021
How we ensure a property is affordable
When new homes are built we ensure that a number of the properties will be sold at less than market value prices. These are achieved by using schemes such as; discounted sale, shared ownership or shared equity. The terms of these schemes are set out in Section 106 Agreements attached to the property. These agreements are unique to each property and remain with the property for it's lifetime.
Home ownership one stop shop aims to help people identify what type of affordable housing scheme could be suitable for them.
Discounted sale properties
When an affordable property is built, it is valued at a market price. The difference between the market valuation and the initial discounted sale price, which is carefully assessed by us, is then worked out as a percentage. This percentage is set out in the Section 106 Agreement and becomes the discount percentage that will be applied to that property every time it is sold. We call these 'discount sale' properties.
Some properties are sold on a shared ownership basis and may be suitable for those unable to purchase 100% of a property.
Shared Ownership schemes usually allow you to buy a minimum 25% share of a property and pay a small amount of rent on the remaining share. The rent is payable to a housing association which usually will own the property. You are normally able to buy more shares in the property over time, this is called 'staircasing'. Some schemes permit staircasing up to 100% when you would then become full owner.
Shared equity is very similar to Shared Ownership but you do not pay rent on the other equity share.
Help to buy
The Government runs a Help to Buy scheme to assist people to buy homes at market prices. The scheme includes; Equity Loans and Mortgage Guarantees. These schemes are not available on affordable properties which are already discounted.
This is aimed at people who may be able to secure a mortgage but haven’t got access to a sufficient deposit. Buyers must have 5% of the purchase price, the rest of the deposit is paid as a loan by the Government. Please note these are not loans provided by us.
Mortgage guarantee scheme
This scheme offers lenders the option to purchase a guarantee on mortgages where a borrower has a deposit of between 5% and 20%. For this option the buyer must have a very good credit rating with no recent defaults.
Help to Buy North West provides further information about the scheme and lists properties currently available to buy.