Thinking of buying a property - SmartShare has thousands of properties to buy or rent across the UK
The term ‘affordable housing’ has traditionally promoted social rented housing and conjures up images of grim, sub-standard council houses.
Today, ‘affordable housing’ is part of thriving mixed communities and encompasses a wide range of choices to suit varying personal, financial circumstances and is associated with shared ownership, part buy part rent, rent to buy and shared equity properties.
Over the last decade, house prices have risen to dizzy heights and fallen dramatically coupled with the current economy and strict measures on mortgages, affordability is a major concern for many, With 1.7 million households on council waiting lists for rented accommodate and the national average house out of reach for many, the idea of a buying a home seems a distant dream for many people.
Yet there is a housing solution for many people, in different circumstances e.g. key workers, first time buyers, friends, individuals who are separated, bereaved, divorced or looking to downsize who do not wish to rent. Let's look at the different terms below:
Shared ownership or part buy part rent is exactly what is says - you buy a share of the property, usually between 25 and 75 percent, and the remainder of the shares are retained by the housing association whereby you pay a discounted rent. Shared ownership schemes allow the home buyer to 'staircase' and buy more shares as and when they can afford it, with the ultimate aim of owning the home outright or putting the equity towards another shared ownership property.
Rent to buy is becoming very popular during the credit crunch as it means you can rent the property before buying. The rent to buy schemes are popular with first time buyers and tenant buyers to get on the property ladder without having to be approved for a mortgage immediately or finding a large deposit.
Rent to buy is also known as Rent to Own, Rent Now Buy Later, Try Before You Buy, Own Now Pay Later, Rent Then Own, Rent2Buy, Rent2Own, Homebuy, Rent To Homebuy.
Shared equity was introduced 31 years ago and has been very successful. It is similar to shared ownership as it is still a form of affordable housing to help certain people onto to the property ladder. Backed by the Government’s own shared equity scheme called Homebuy Direct – it is a great way to purchase a brand new home.
Shared equity means that the purchaser buys the home outright usually by taking a 70% mortgage plus a 30% low cost equity loan (funded by the developer or government scheme) which are secured against the property as two separate mortgages. When you come to sell the property, both mortgages are paid off and if the property value increases then so does the equity share as this is a percentage share and not a fixed amount.
SmartShare are delighted to announce that top property developers Taylor Wimpey, Persimmon and Barratt Homes have signed to advertise their affordable homes on our national website.