making home ownership affordable phil moore neighbourhoods regeneration manager
Post on 15-Jan-2016
216 Views
Preview:
TRANSCRIPT
MAKING HOME OWNERSHIP AFFORDABLE
Phil Moore
Neighbourhoods Regeneration Manager
WHY TENURE DIVERSIFICATION?
• Creating mixed, attractive sustainable areas
• Applies to existing as well as new neighbourhoods
• New neighbourhoods over 50% ownership
• Current estates typically 2% to 25%
• So a programme to sell existing customers their homes
DEVELOPING NEW APPROACHES:FIRSTLY, SOCIAL HOMEBUY
• Early pilot from 2006 • 4000 customers in 14
areas• Discount of £9k to £16k• 32 sales• Verdict – small scale, not
very affordable.• Niche product• Conclusion - new product
needed
RENTING TO OWNING
• PfP own product• Voluntary Sales scheme• Based on equity loan• For good/long standing
customers of 5 years plus• Buy at 60% or 70% market
value - £100k house for £60k mortgage
• No payment on the equity loan part
• Full ownership• Only condition – repay same %
on first sale.• BUT – market collapse !
KEY DRIVERS
• Primarily to fulfil home ownership and financial aspirations of customers – asset building
• More sustainable communities-keeping residents with jobs
• Financial model that is neutral between selling and renting, acceptable to RSL
RtO LAUNCH AND RESULTS SO FAR
• Phase 1 2009 launch to 25 areas, 8500 customers
• 9 sales so far• Phase 2 just
launched – 6800 customers including 3 large areas
WHAT DO WE THINK OF IT SO FAR?
• Slow burner – changing neighbourhoods is a long process
• Still market testing through variety in the pilots
• Current market is very low – preparing for the future
• Equity loan not easy to market• An attempt to cut through the
first time buyer barriers – high deposits
• Still a niche product
THE BENEFITS
To the residents• Making home ownership affordable on an income of
£20k+• Building a long term asset• Fulfilling aspirations• Financial inclusion
To the organisation• More balanced neighbourhoods • Keeping residents with jobs• Financial – capital receipt equals rental stream• Financial – recycled capital grant• Financial – equity as an asset
NEXT STEPS
• Evaluate• Widen the scope – all PfP
customers?• New products to achieve
higher ownership rates – eg sale of vacants pilot using the same equity loan model
• Keep going – meeting customers aspirations
top related