HomeBuy Options

Do you want to own a home of your own but think that you can't afford it? Have you heard of the Governments HomeBuy Initiative? You could be a homeowner within 6 to 8 weeks!

What is HomeBuy?
HomeBuy is the term used to describe a Government initiative that assists eligible individuals and families find homes that meet their current needs that they could not otherwise afford to buy without assistance. The Government has appointed a number of HomeBuy Agents throughout England to help and support those who are seeking to live in specific areas.

For many people, this program will provide the best chance of owning a home in the area in which they want to live and work. The initiative also offers some discounted rental options for those who are eligible.

Although we explain all the options, not all of these are available in all areas so it is important to check what is available with the HomeBuy agent covering the area you want to live in.

What is a HomeBuy Agent and who are Catalyst Housing Group?
Catalyst Housing Group (opens in new window) is the Government appointed HomeBuy Agent for Buckinghamshire, as well as Berkshire Oxfordshire and Surrey. Catalyst Housing Group provides a "one-stop-shop" service for home ownership and rental opportunities that exist in these areas. By registering with Catalyst HomeBuy, individuals are assessed in order to identify the schemes for which they are eligible. Catalyst, as a HomeBuy Agent, work with a number of organisations including other housing associations, private developers, estate agents and local authorities to ensure customers are kept informed about all the opportunities available.

Catalyst organises regular HomeBuy shows. At these events, independent financial advisers and solicitors provide affordability assessments and free advice. The HomeBuy show is a great opportunity to find out more information and have queries answered face to face. Entry to these shows is free so visit the website for the latest dates.

There are a number of different scheme types that are offered under the HomeBuy initiative. Depending on your individual circumstances you may find that one or more may be suitable for you.

Shared Ownership
Shared Ownership is a part-buy/part-rent scheme (previously known as NewBuild HomeBuy) that enables the purchaser to buy a percentage of a newly built property, usually from a housing association (who have usually bought the homes at a discount from a developer.)

Under this scheme the approved applicant then buys an initial share of between 25% to 75% (depending on an affordability assessment) of the open market value of the newly built home from the particular provider. The provider retains ownership of the unsold share on which a subsidised rent is charged. The rent is normally paid on a monthly basis as it would if rented from a private landlord. The combined rent and mortgage repayments are less than the monthly costs of buying outright because of subsidy in the form of central government grant, or discount from the developer as a condition of his planning permission or from the housing association’s reserves

Staircasing is the term used when the ‘shared owner’ can purchase further shares in the property (normally at a minimum of 10%), if and when they can afford and desires to do so, until the property is owned outright (subject to terms and conditions).

This scheme is especially suitable for individuals who are unable to:

• Raise a sufficient deposit to allow a mortgage to be approved
• Obtain an adequate mortgage approval to purchase a property outright even when a ‘healthy’ deposit is available.

There have been a number of newbuild shared ownership schemes in South Bucks including most recently 10 flats at Bells Hill Stoke Poges, 21 flats and houses in Devonshire Green, Farnham Royal and 10 houses and flats in Candlemas Lane Beaconsfield. Further newly built shared ownership houses and flats in Old Beaconsfield are due for completion in Spring 2012. Make sure that you are registered with Catalyst if you think these might suit you!

Resales
Resales are shared ownership homes that become available when existing ‘shared owners’ wish to sell their stake in the property they currently own. This is normally as a result of them moving up the property ladder due to a change in circumstances or moving away to more affordable areas.

The share that can be purchased and the rent payable will differ from one property to another, as a result of differences in the percentage initially purchased and any staircasing activity that has occurred.

Over the years housing associations have developed dozens of newly built shared ownership homes in South Bucks as well as many hundreds of open market properties being bought by individuals on shared ownership terms through old schemes like ‘MyChoice’ and ‘Do it Yourself Shared Ownership’ (neither still available for new applicants unfortunately) – but on average each year about 15 resales occur within this stock and these are offered to registered applicants before being advertised more widely through Estate Agents like RightMove.

Equity Loans
Equity loan schemes offer low-interest loans that boost a purchaser’s affordability by topping up the mortgage that they are able to get. These schemes allow individuals and families to purchase a property that they would normally be unable to afford. The loans offered will have varying repayment requirements depending on the specific provider and will sometimes offer interest free periods, followed by charges on very favourable terms.

These schemes, when available, can either be limited to specific local authority areas or employment sectors ; they may be tied to specific new build developments or include‘open market’ properties. The terms will normally depend on who developed and provided the funding for the scheme.

YourChoice South Bucks own Equity Loan scheme
South Bucks and Catalyst have formed a unique partnership to provide ‘ YourChoice (pdf file)’ an open market home purchase equity loan scheme for qualifying applicants who cannot afford to buy without assistance.

YourChoice’ is one of the most flexible and popular forms of affordable home ownership. Subject to conditions approved applicants can buy what they need, where they want it without the restriction of being limited to designated units on new build developments.

Equity loans are available of between 15 – 50% of the purchase price of a property you choose on the open market, subject to conditions.

FirstBuy
FirstBuy is a Government funded equity loan scheme which offers eligible individuals the opportunity to buy a new home on certain specified new developments with the assistance of an equity loan for up to 20% of the full purchase price of the property. The FirstBuy equity loan has no interest payment applied for the first five years. From year 6 onwards an annual fee is payable based on 1.75% of the loan indexed each year to RPI +1%.

FirstBuy is now available at selected developments across the Berkshire, Buckinghamshire (including Milton Keynes), Oxfordshire and Surrey from a range of developers including Persimmon Homes Turner’s Field scheme in Little Chalfont.  Please go to www.catalysthomebuy.co.uk for the latest information on FirstBuy. There are currently no developments actually in South Bucks which offer FirstBuy.

HomeBuy Direct
A shared-equity scheme designed to help first time buyers have 100% ownership of their property. The purchaser will be the legal owner with full title to the home and can sell it on the open market without restriction.

The buyer buys a new home, on a designated HomeBuy Direct development, with assistance from the Government and the house builder in the form of two equal equity loans.

The equity loans would be up to 30% of the purchase price leaving the applicant to raise 70% by way of a mortgage plus a deposit, if available.

The equity loans are interest free for the first five years. After that, there is a fee of 1.75%, rising annually by the Retail Price Index (RPI) plus 1%.

To date there has only been one HomeBuy Direct development in South Bucks on the Persimmon development in Stoke Poges and there are no further schemes planned.

Rent To Buy
Under this scheme, purchasers have the opportunity to rent a newly built property provided by a housing association (or other provider) at a rate which is normally 80% (or less) of the current market rental value. The rent is payable for a predefined period after which there is an expectation that the tenant will purchase a share in the property through the Shared Ownership scheme, thus becoming a ‘part-owner’.

The rental period is designed to give the prospective purchaser an opportunity to save for a deposit to put towards buying a share of the property they are renting at a later date i.e. through shared ownership. Some providers of this scheme will also offer incentives to save while the property is being rented. However, there is no obligation to buy a share in the property if the tenant does not wish to e.g. where personal circumstances have changed and the property no longer meets their requirements or aspirations.

To date no Rent to Buy homes have been provided in South Bucks

Intermediate Rent
Intermediate Rent provides a short term tenancy at 80% of typical market rates. In most cases the initial rental period is for six months and the person’s ongoing need for the property may be reviewed on an ongoing basis. Under some circumstances, at a later date, tenants may have the option to buy a share of the property by converting the tenure to Shared Ownership (like rent to buy).

Originally this form of intermediate rent tenancy was funded and provided to certain specified keyworker employees. There is no current differentiating of funds for Key Worker schemes and no intermediate rent properties were developed in South Bucks.

Social HomeBuy
This scheme allows some housing association or local authority tenants to buy their current home either outright or on a part-buy/part-rent basis with the benefit of a discount. To do so, their landlord must have decided to take part in the scheme. This is only likely to be of interest to tenants who do not qualify for the Right to Buy or Right to Acquire or who are not currently in a position to buy their home outright. Contact your landlord for more details.

Eligibility Considerations
Eligibility rules have been amended by the Homes and Communities Agency (HCA) for existing homeowners.

As a result, all current home owners including existing owners of shared ownership leases or shared equity homes, who wish to be considered for any public funded HomeBuy schemes are now required to have a 'Priority Need for Accommodation' approved by their current local authority BEFORE they can be accepted on to the HomeBuy register.

Once you have completed HomeBuy registration, you will be advised of the process for local authority approval.

The priority need for accommodation will be assessed in accordance with the provisions of the Housing Act 1996.

In addition, to be eligible for HomeBuy schemes, candidates must meet one of the following criteria and have a household income that does NOT exceed £60,000 per annum.

Where you have met the initial eligibility criteria, the Government has further prioritised the following four groups for HomeBuy funded schemes:

Existing Social Tenants
Those that currently reside in a Council or Housing Association property on an ‘assured short-hold tenancy’ basis, where if they were to vacate the property it would be made available to someone on a priority list for housing in that area.

Ministry of Defence Personnel
Certain categories of staff employed by the Ministry of Defence as specified by the Homes and Communities Agency (HCA).

Local Priorities
Some local authorities may specify individuals or groups that they want to prioritise in their area of operation. This may include employees of specified public sector organisations,certain key workers . In South Bucks for example employees at Wexham Park Hospital are eligible to be considered for the ‘YourChoice’ equity loan scheme.

First Time Buyers
Individuals and families that are seeking a first step on to the property ladder.

Other Priority Considerations
A number of additional eligible groups have been identified as those that may be considered for the HomeBuy Options available on a case by case basis. These include those that may be experiencing a major change in circumstances such as:

• Overcrowding of an existing property due to a new family addition
• A forced sale as a consequence of divorce/separation
• A requirement to care for a sick relative

Other eligibility considerations
In most circumstances you must not have been in rent arrears over the last 12 months. Due to standard mortgage evaluation checks, it is likely that if you have a low credit rating as a result of arrears, debt, county court judgements etc. You will be unable to proceed in the purchase of a property.

Your name, or the name of any joint registrant, must not currently be on the deeds of another property whether in the United Kingdom or abroad. Only in certain specific circumstances will this be negotiable. To discuss this please call the HomeBuy Team on 0845 601 7729.

You are required to certify that ALL the information you provide is complete and accurate and be happy for the information to be shared with appropriate other organisations including for example the local authority, in order to confirm eligibility and to ensure that information about the best options for you is made available for you to consider.

So if you meet these requirements what should you do now?
Register with Catalyst HomeBuy by setting up your personal profile online at www.catalysthomebuy.co.uk. Alternatively, call our HomeBuy Team on 0845 601 7729 for registration form.

If you want to apply for the South Bucks ‘YourChoice’ open market home purchase scheme, you have to complete a paper application even if you are already registered on the Catalyst database. You must also register on the Council’s Housing Register by joining BucksHomeChoice on line www.buckshomechoice.gov.uk

What happens next?
Once on the Catalyst Housing Group’s HomeBuy Register, you will: -

• Receive a letter or email confirming your eligibility and outlining the level of assistance you are likely to receive.
• Be kept up-to-date with the latest changes in affordable home ownership opportunities.
• Receive marketing details of any suitable new affordable housing schemes that are being developed in the District.
• Receive details of re-sales of existing shared ownership properties.
• Have access to any other HomeBuy schemes promoted by Catalyst and advertised through the HomeBuy website, subject to any eligibility criteria.
• If you applied for ‘YourChoice’ once eligibility is confirmed you will be referred to an independent financial advisor for affordability assessment and supported through the scheme...

This information is provided by the Catalyst Housing Group and South Bucks District Council and is subject to change at short notice so please visit the website – www.catalysthomebuy.co.uk for the latest details as this is updated regularly.