Once built, this housing is often available to rent or to buy in
several different forms. This section explains exactly what
affordable housing is, and the different types of affordable
housing that the Housing Strategy team actively works with its
partners to provide in Peterborough. Generally speaking, affordable
housing is defined as housing for people who cannot afford to rent
or buy a home on the open market. A more detailed definition of
affordable housing can be found on the Information for developers
page.
Social Rented Housing
Social Rented housing is the most common type of affordable
housing in both Peterborough and the rest of the UK. It is usually
owned and managed by a local authority or a housing association,
let for a rent that is significantly below what you would expect to
pay on the open market and offered as a lifetime tenancy.
Peterborough City Council no longer owns any of the affordable
housing stock in the city. All affordable housing in Peterborough
it is now owned and managed by a number of housing associations.
However, the council still oversees the allocation of all the
social rented housing in Peterborough.
How
can I access social rented housing in Peterborough?
However, as a consequence of government reforms, the supply of
social rented stock is likely to decrease over coming years. The
Government’s new affordable housing policy states that funding to
build new social rented properties will only be available from the
Homes and Communities Agency in very limited circumstances.
Furthermore, the government is also encouraging housing
associations to convert a proportion of their existing social
rented housing to the new ‘affordable rent’ tenure (see below). The
government anticipates that the increased rental income from
converting properties to ‘affordable rent’ from ‘social rent’ will
fund new development.
Affordable Rented Housing
Affordable Rent is a new tenure that has been
introduced by the Government in order to support the new delivery
model for affordable housing. For more infomation see our Information for Developers Page. Owned and
managed by housing associations, affordable rented housing will be
made available to tenants at up to a maximum of 80 per cent of the
rental cost of a similar property in the private rented sector. The
minimum length of term of an affordable rent tenancy is two years.
As with social rented accommodation, affordable rent tenants will
be able to claim housing benefit to assist with rental costs. It is
the intention of the government that the affordable rent tenure
becomes the principle element for future affordable housing
supply. As with social rented accommodation, the allocation
of affordable rented accommodation is overseen by the Council.
Advice about how to make an application for affordable rented
housing in Peterborough is available from the Housing Needs
team.
Intermediate Rented Housing
Intermediate Rent is available from housing associations who
charge a rent level which is higher than for social rented
properties but lower than rent charged by private landlords.
The rent charged is typically between 75 per cent and 80 per cent
of the local market rent for a property of a similar
standard. To qualify for an allocation of an intermediate
rent home, occupants must be able to meet their rental costs
without reliance on Housing Benefit. During 2008 - 2011, the
HCA funded the development of a large number of intermediate rent
homes on various sites across Peterborough. However, the
Government’s new housing policy is unlikely to deliver any
additional intermediate rent homes.
Affordable Home Ownership
‘HomeBuy’ is the umbrella name for affordable home ownership
products that are backed by the Homes and Communities Agency (HCA).
Details of these schemes are set out below:
Shared Ownership
Shared Ownership is a product that is designed to assist those
who are unable to obtain a mortgage to cover the full cost of a
home. The arrangements under shared ownership are as follows; a
housing association offers shares of a property for sale of between
25 per cent and 75 per cent. The purchaser takes out a mortgage for
the share of the property that they own, and they pay a subsidised
rent on the remaining share. A shared ownership arrangement means
that the combined cost of the mortgage and rent should be less than
the cost of a mortgage on the whole property, thus providing a
lower cost route to home ownership. In most cases, the
homeowner can purchase additional shares in the property until they
own the property outright.
Rent to Homebuy
Rent to HomeBuy is a scheme designed to help potential
homeowners get onto the housing ladder. Initially occupants rent
the home from a housing association at 20 per cent less than the
rent that would be paid to a private landlord and then once the
fixed term tenancy comes to an end the occupier has the option to
buy the property through shared ownership. A number of homes
across Peterborough have been built and let on a Rent to Homebuy
basis. However, it is unlikely that any more government funding
will be available to finance Rent to Homebuy homes.
HomeBuy Direct (Equity Loan Scheme)
HomeBuy Direct is a scheme which provides equity loans to help
qualifying first-time buyers purchase selected new build properties
on the open market. Although this product is not included within
the definition of affordable housing, it does make buying a home on
the open market more affordable. The purchaser is required to fund
at least 70 per cent of the property purchase themselves by way of
a mortgage and/or deposit. The outstanding balance is covered by an
equity loan which can be up to the equivalent of up to 30 per cent
of the property value. Under the HomeBuy Direct scheme, the equity
loan is provided jointly by the developer and the Homes and
Communities Agency.
In Peterborough, funding was provided to
enable over 200 Homebuy Direct equity loans. However, funding for
this scheme has now ceased and therefore no additional new build
units will be made available for Homebuy Direct equity loans
although some homes may still be available to purchase under the
scheme up to March 2012. If you are interested in buying a
new-build home, please ask the developer if they can offer Homebuy
Direct.
FirstBuy (Equity Loan Scheme)
In March 2011, the Government announced details of its new
equity loan scheme ‘Firstbuy’.
The scheme, which is administered by the Homes and Communities
Agency, provides funding to over 30 private house builders to
enable over 1,800 equity loans in the East and South East region
(including Peterborough). The scheme is designed to help first time
buyers struggling to obtain a mortgage for the full cost of their
home by providing an equity loan of up to 20 per cent of a home’s
value. Purchasers are required to fund at least 80 per cent
of the property purchase through provision of a mortgage and a
minimum deposit of 5 per cent of the full market value of the
property. The equity loan is classed as a second charge on the
property and interest will be charged on the equity loan after 5
years.
If you are interested in buying a new-build home, please ask the
developer if they offer the Firstbuy
scheme.