Our aim
Our aim is to keep the district's communities and economy thriving. Part of this is to make sure there are homes of varying sizes and tenures in a range of locations to suit different needs. We recognise that many people who live or work in the district, even those who earn a reasonable income, can have difficulties buying a home. We work with registered providers (what many people know as housing associations) to help people get onto the property ladder. We do this mostly through the Help to Buy shared ownership scheme, where you own a share of the property and also pay reduced rent.
In addition, there are the Help to Buy equity loans and ISAs, which help people who have a smaller deposit buy a home built by private developers. More details can be found in the "Helping you afford a home of your own" leaflet and the Help to Buy website
If you only have a 5% deposit these Help to Buy schemes can help. Help to Buy is a government backed initiative to help you buy a home of your choice. There are two elements; Help to Buy equity loans and Help to Buy mortgage guarantee:
Help to Buy equity loans. This scheme helps you buy a new home on a specific development. You own the whole property from the start. You fund at least 80% of its value with a mortgage, and a deposit which can be as low as 5%. The remaining amount, up to 20%, is provided by an equity loan provided jointly by the developer and the Government. An equity loan is repaid through the increase in value of the property rather than regular capital and interest payments. There are no payments on the loan for the first five years. After this, there is a yearly fee of 1.75%, increasing in line with inflation. In addition, you pay the mortgage repayment monthly in the usual way. When you sell the property, you repay the loan by repaying the same percentage of the sale cost as you borrowed. For example, with a 20% equity loan:
| Percentage of the sale | Sale cost |
|---|---|
| Property value year 1 | £200,000 |
| Mortgage (75%) | £150,000 |
| Deposit (5%) | £10,000 |
| Equity loan (20%) | £40,000 |
| Property value when later sold: | £240,000 |
| Increase in value | £40,000 |
| Mortgage repaid | £150,000 |
| Equity loan repaid at 20% of current property value | £48,000 |
| Increase in value that you keep | £42,000 |
Help to Buy ISA. If you are a first time buyer and you new home doesn't cost more than £250,000, the government will boost your savings by up to £3,000 through a Help to Buy ISA. This is £3,000 per person, so a couple can double their savings. You can save up to £200 per month and in the first month you can deposit up to £1,200. You can open the ISA through banks and building societies and your solicitor will claim it for you.
For more information on Help to Buy equity loans, mortgage guarantees and ISAs, visit Help to Buy initiatives .
Discounted purchase and shared equity
There are small numbers of homes, mostly in Chichester, Tangmere and Selsey, which are kept for people with a local connection to the district to buy at less than market value (i.e. discounted purchase). A local connection includes living or working here, having close family here, or having previously lived in the district but being forced to move away because of a lack of affordable housing. These properties must be sold on, at the same percentage discount, to other local people.
With shared equity you buy all the home at a reduced percentage of the market value. The balancing percentage is held by the developer, by a legal charge on the property. However unlike shared ownership, no rent is paid on it. You can buy out the developer's interest if you wish, so your home is then free of any developer's ties. If you don't, and you sell, you will pay back this balancing percentage from the equity in the property. There are shared equity homes in Chidham and Lavant.
The council is not normally involved in the resales of these properties, except for approving new purchasers, as they are advertised privately. We are looking to provide more of these opportunities in the future.
If you meet the length of service requirements, you maybe eligible for a loan of up to 50% of your salary to a £25,000 maximum. The applications are made through the services' Joint Personnel Administration system.
The government has also produced a how to buy guide provides homeowners and prospective homeowners with a helpful overview of the process of buying a home.
It sets out:
- the important steps along the way to purchasing a property
- which organisations can help
- where readers can find more information