There are a number of legislative changes that come into force from August 1st 2007 which affect the home buying process. Rightmove is currently in the process of comprehensively updating our website information to ensure our content is as accurate as possible. Please come back soon to see our brand new Buying Guide.
Recent measures taken by the Government aim to help first-time buyers get their foot on the housing ladder. The stamp duty threshold has been raised to £120,000 and announced plans in May 2005 of a new scheme which aims to help buyers and key workers share the cost of a property. However, getting your foot on the ladder is still difficult, particularly when the average asking price for a property in the UK is nearly £200,000. The average asking price in London is approximately £250,000, according to the latest Rightmove House Price Index. But, there are a number of options available to help those looking for an affordable home.
Home Ownership Schemes
There are four options available to those who need a boost onto the property ladder. Some schemes are only available to key workers, such as nurses, doctors, firefighters, etc., or to council and housing association tenants.
Conventional Shared Ownership
This option is for those of us who cannot afford to buy a home on the open market. Under this scheme, you buy a partial share in a home - usually 25-30% - owned by a housing association. You buy that share via a mortgage. You rent the remaining share from your housing association (now called Registered Social Landlord.) After a year, you can buy more shares at current market value.
Do-It-Yourself Shared Ownership
This option is offered by a few local authorities. It allows you to select a property on the open market and then buy it on shared ownership terms with the local housing association. You pay rent to the housing association on the share you don't own.
Homebuy
This national scheme allows home buyers to get a 25% loan from the local housing association to fund the purchase of a home. If you qualify, you can apply for the loan from your local housing authority, and fund the remaining 75% of the property price with a mortgage. You pay back the 25% when you sell. This is mainly open to council or housing association tenants.
Key Worker Homebuy
This scheme is open to key workers (nurses, doctors, teachers, etc.) in London. It allows key workers to find a property in London on the open market (under 90 minutes travelling time from work, up to a value of £210,00) and get an equity loan of up to £50,000 towards the cost.
Who is eligible?
Each scheme has its own priority list. The best advice is to contact your local authority and find out if you qualify for any of their housing initiatives. Usually, the following standards apply, but it is best to contact your local authority directly to find out qualifications in your area:
- You have been living in the borough for over 2 years.
- Generally, your minimum income should be at least £17,000 a year and your maximum household income is £42,000 for an individual, £50,000 for a couple.
- A European Union or British passport is required, or permanent resident status if an overseas passport holder.
Find out more
Below is a list of websites that may help you contact your local authority, or explain the housing schemes:
- www.direct.gov.uk - lists contact details for all local authorities in UK
- www.housingcorp.gov.uk - describes the homebuy scheme
- www.odpm.gov.uk - Office of the Deputy Prime Minister which explains many of the homebuying schemes.