Right to Buy or Shared ownership?

Over the last few weeks, we’ve seen a marked increase in enquiries for Right to Buy properties and those looking to purchase on a Shared Ownership basis.

Right to Buys are usually via the local council selling their properties to the existing tenant at a discounted price.  This discount can be up to £77,900 (£103,900 in London) and applicants must have been a public sector tenant for at least three years.  Some lenders will allow borrowing of up to 100% of the purchase price.  If you resell your home within five years you will usually have to repay some or all of the discount you received, however remortgaging is usually allowed in this time period.  There are other schemes available to housing associations and the Government has plans to extend Right to Buy to more housing association tenants.  So if you think you are eligible, register on the Government's website.

Shared Ownership Schemes are normally provided through housing associations.  You buy a share of your home, between 25% and 75% of the property value, and pay rent on the remaining share to the housing association.  You usually have the opportunity to purchase a bigger share of the property later on (normally called ‘staircasing’).  Local housing associations must confirm your eligibility in order to join these types of schemes.

Both schemes are proving popular in the local area and a wide number of lenders are looking to lend in both scenarios and to a number of different customer types, even those who may have had financial credit blips in the past.  So always seek advice.

Finally, first time buyers generally are in the spotlight again with many great rates and low fee products available.  One in particular, launched over the last few weeks, will allow customers to achieve, subject to an affordability assessment and minimum income levels, a loan equivalent to six times their income.  Yes SIX!  With a 15% deposit required and a competitive rate of interest, this product is an exclusive from the Tipton & Coseley Building Society.  Obviously terms and conditions apply.  There still needs to be a lot more innovation in helping the First Time Buyer sector overall, but huge credit to those trying to assist in the current climates.