Low Cost Home Ownership
If you want to get your foot on the housing ladder but can't afford to buy a home of your own, there are a range of options which the Borough of Poole and our Housing Association Partners can offer. This leaflet explains them in detail. In order to be considered for any of the following, you need to have joined our housing register and either indicated on your form your interest in such schemes, or, registered with Home2own 
.
Please note that in order to be considered for most Low Cost Home Ownership opportunities in Poole, you need to currently live or work in Poole.
Home2own
Home2own is a service provided by Westcountry Housing & Sovereign Housing Group and has been awarded 'HomeBuy Agent' status by the Government to help people in Dorset, Salisbury and South Somerset access low cost home ownership schemes within those areas.
As HomeBuy Agent they will act as your first point of contact for information, advice and access to affordable home ownership.
To Register with Home2own please complete an application form which can be obtained from Home2own by contacting:
Home2own
Phone: 0300 100 0021
Email: info@home2own.co.uk
Web: www.home2own.org.uk
New Build Home Buy Scheme
New Build HomeBuy (previously known as Shared Ownership) is a Part Buy/Part Rent scheme. It enables you to buy a share that you can afford in a new home, usually around 50% but there are sometimes opportunities to purchase smaller or larger shares. (25 or 75%). A discounted rent is paid to the landlord on the remaining share. Usually, you are able to purchase further shares at a later date enabling you to own 100% of your home if you wish.
These homes are built by Housing Associations or other developers who are working in partnership with the Local Authority and other agencies to provide homes at low cost.
Please see Home2own website - www.home2own.org.uk for details of homes available now and coming up soon.
The cost of the mortgage for the share purchased plus the rent for the remainder should be more affordable than the cost of purchasing 100% of the same property in the majority of cases.
Resales
It is also possible to buy a resale of a HomeBuy property. This is when the current owner wishes to sell their property.
Open Market HomeBuy
Open Market Homebuy is a scheme which allows you to purchase a property of your own choice on the open market. There are currently 2 products available:
MyChoice HomeBuy through Swaythling Housing Society. This is an equity loan scheme offering eligible first-time buyers up to 50% of the cost of their home.
Purchasers must be able to raise at least 50% of the cost of the home they choose and Swaythling will top up the remainder with a loan.
The loan provided by Swaythling can be between 15-50% dependant on your affordability.
The interest charge on the loan will be 1.5% to start off with from day 1, increasing by RPI plus 1% per annum.
MyChoice HomeBuy gives people the freedom to search for a mortgage of their choice from any High St lender and search out the best deals. It is also a scheme that allows purchasers to choose a home they like on the open market, normally though an estate agent.
After a year you have the opportunity to redeem all or part of your equity loan owing on your home if you can afford to. This can be done in 10% sums. www.swayhs.org.uk
Ownhome. This is also an equity loan scheme and offers first-time buyers between 20-40% of the cost of their home.
This scheme is through Places for People and your mortgage is restricted to the Co-operative Bank only.
No interest is charged on the equity loan for the first 5 years. After 5 years a fixed interest rate of 1.75% will be charged on the Ownhome loan each year.
After a further 5 years (at year 10) the interest on the loan with increase to 3.75% per year for the rest of the loan period.
For more information on Ownhome through Places for People please contact www.ownhome.co.uk
HomeBuy Direct
Available to first-time buyers only and will allow up to 30% equity loan to be used to buy a 'new build' property. No charge on the equity loan for first 5 years, charges will apply in 6th year onwards.
Eligiblity will be the same as other HomeBuy products - applicants earning less that £60k. Applicants that have had a relationship breakdown or families that are overcrowded who are exisiting homeowners will also be eligible.
The difference will be for the developers. It is now open to any developer to apply for funding of this scheme on their sites.
Applicants will be able to staircase up to achieve full ownership.
Mortgage Rescue Scheme
The Government announced recently the launch of a £200 million pound mortgage rescue scheme to assist up to 6,000 of the most vulnerable households facing repossession over the next two years.
Full details of the scheme including criteria and eligibility have not been announced therefore we are unable to take any applications for this scheme at this time. When full details are known these will be published.
If you are currently facing problems with repaying your mortgage please contact the Housing Advice Team to discuss your situation and options available. Tel: 01202 633804.
Home Purchase Grant
Unfortunately this scheme is no longer available.
Who is Eligible for Low Cost Home Ownership?
As a general rule all applicants for LCHO in Poole must live or work (over 26hrs) in the Borough. There may be some exceptions where the applicant has been awarded priority or reasonable preference on the housing register. Each case will be assessed individually.
Applicants can purchase a property that is not more than one bedroom size larger than their housing need.
Any applicant on MyPlace register will have any available properties they are eligible for marketed directly to them.
How are applicants prioritised?
Applicants will be prioritised in the following way:
Priority 1 - Council or Housing Association tenants with no rent arrears and Homeless Applicants we have a duty
Priority 2 - Applicants who are threatened with homelessness
Priority 3 - Housing Register applicants whose family composition (housing need) matches the size of property eg. 2 adults, 1 daughter = 2 bed
Priority 4 - Housing Register applicants for whom the property in one bedroom size larger than their need
Within each priority group applicants will be in date order of the date they joined the housing register.
Affordability & Sustainability of Low Cost Home Ownership
The first step in considering whether Low Cost Home Ownership is an option for you is to consider how much your income will support in terms of borrowing on a mortgage. As a very general guideline it is standard to times your household income by 3 ½ to see what the maximum amount is that you might be able to borrow. If you are able to put down a deposit, you may be able to reduce the amount of mortgage needed.
For New Build HomeBuy your household income will need to be sufficient to cover the monthly rent as well as the monthly mortgage repayments. So, for example, if you are purchasing a 50% share of a 1 bed flat at £52,500 and the monthly rent is £150 (this is an estimate only) then you will need an annual income of £15,000 to raise a mortgage for the share you are purchasing plus £1800 to cover the annual cost of renting (12 X £150). This means that your total annual income will need to be at least approx. £16,800.
For Open Market Homebuy your household income will need to be higher because you will need to be able to raise 75% of the purchase price. For example if the full property price is £120,000, the Equity Loan available will be £30,000. If you have no deposit this will require a mortgage of £90,000 where a household income of £25,700 is needed to support such a mortgage (again this is an estimate only). For option 2, mortgage capability will need to be higher - 82.5%.
Please note that this is a guide for information purposes only. These figures do not take account of any other financial commitments you may have such as loans, child maintenance etc. Also these figures are based on a single earned income. The amount you can borrow may be different if your household income is based on two or more people having salaries.
Other important costs to consider - Transaction Costs
There are costs involved with the actual process of purchasing a property. It is therefore essential that you consider whether you can afford transaction costs, which could be as much as £2,500 (more if Land Registry charges apply to the property you are purchasing) which will include legal fee's, surveys, arrangement fees etc..
Sustainability
As well as considering your Borrowing capacity and Affordability, it is important to consider the longer term sustainability of your home ownership. As well as keeping up to date on your monthly mortgage payments and rental payments to the Housing Association (if applicable), the following costs need to be considered;
- Service Charges
- Insurance
- Maintenance
It is also vital that you consider whether any changes in mortgage interest rates would adversely affect your ability to sustain your mortgage. An independent financial adviser will be able to help you with this.
IT WILL BE IMPORTANT FOR YOU SEEK APPROPRIATE PROFFESIONAL ADVICE FROM A FINANCIAL ADVISOR AS THIS INFORMATION IS ONLY PROVIDED AS A GUIDE
What happens now that I have applied for homebuy?
Once you have registered on the Borough of Poole Housing Register and with Home2own, as long as you fulfil basic eligibility criteria (living or working in Poole in most cases, with a reasonable income and/or savings) your details will be passed to the various Housing Associations in the Borough who will market their available HomeBuy properties directly to you.
We are always looking for new an innovative ways of providing Low Cost Home Ownership, and as a result, more options may present themselves over time.
Please Note: Low Cost Home Ownership is not available to anyone who is considered to have access to sufficent resources to purchase a home that is suitable for their needs without any additional help.
Raglan Housing Association
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