Slough Borough Council has announced plans to launch a shared ownership scheme aimed at helping local people buy a home in the borough.
The scheme, known as a ‘Local Authority Partnership Purchase Mortgage Scheme’, will be run in conjunction with Censeo mortgage brokers and a number of high street mortgage lenders, including TSB, Halifax and Nationwide Building Society.
The initiative is aimed at helping buyers who can afford mortgage repayments, but who cannot afford to buy a property outright, or who may not have the large deposit often required.
The scheme will be available on properties for sale up to the value of £400,000, meaning potential buyers will not have to choose from designated properties or sites.
It will enable people to buy a 70 percent share of a home by obtaining up to a 90 percent mortgage on their share, while the council will buy the remaining 30 percent.
The buyer will then pay Slough Borough Council rent on the council’s share.
Other percentage splits will also be considered to ensure buyers have access to the most appropriate arrangement for their personal circumstances.
The scheme is the first of its kind in Slough and is planned to be in place by June 2016. Initially it will be offered to 10 eligible applicants but could eventually be available to up to 100 buyers.
Priority will be assigned using a points based system that will favour local residents, key workers, applicants with children, first time buyers and those already living in council homes or on the housing register. The council is preparing to accept applications during a set period in June – applications received outside that timescale will not be accepted.
Councillor Rob Anderson, leader of Slough Borough Council, said: “Many single people and families in Slough can’t afford to buy outright or they’ve outgrown their current home and can’t afford to move somewhere bigger and more suitable.
“This scheme provides a relatively low risk opportunity for us to help people to buy their first home or move, while assisting the local housing marking and relieving the huge demand.
“It will also provide a helpful revenue stream to support the council’s financial position in future.”
Capita Asset Services developed the Local Authority Partnership Purchase Scheme in partnership with several local authorities prior to the implementation of this national scheme.
Cecilie Booth, company director of Capita Asset Services, said: “The combination of relatively high house prices and understandable caution over lending from banks and building societies means many potential buyers are unable to afford outright purchase even though they could afford mortgage repayments.
“This initiative is designed to bridge that gap. More people will be able to take the step of buying their first home or moving to a home that meets their needs, stimulating the local housing market and benefitting the wider local economy.”
Only buyers with a minimum 10 percent deposit on the purchased share who can meet the repayments will be eligible for the council scheme. The potential buyer will also need to meet the normal criteria of the mortgage lender.
The council will invest £9.5m in the scheme over the next two years, as part of its capital programme.