Greatwell Homes (formerly Wellingborough Homes) and Rentplus, the leading provider of affordable rent to buy homes, are working again together to provide 32 new build homes in Northampton as an affordable pathway to homeownership for working families in the town.
Banks and building societies are demanding ever higher deposits to secure mortgages, which is unaffordable for many. Figures from the National Housing Federation show that house prices in Northampton are eight times the average salary of £28,605. Households would need an income of £52,262 to afford a standard 80% mortgage in the town, leaving many local residents unable to buy their own home.
The Rentplus scheme allows for prospective buyers to rent their home for five to 20 years at an affordable rate, whilst using that time to save towards a deposit and build good credit ratings. At the end of the agreed term, they have the opportunity to purchase, at which point, Rentplus gifts them 10% of the purchase price towards their deposit.
The 32 new build homes, located on Lancaster Way, Northampton, will soon be available to prospective buyers and will include two and three bedroom homes. Greatwell Homes are working in partnership with Rentplus, Northampton Borough Council and established local house-builder, Barry Howard Homes, on this scheme. Barry Howard Homes have been building quality homes in the East Midlands since the 1990s.
Denise Lewis, executive director at Greatwell Homes, said: “We’re excited to continue our partnership with Rentplus to provide more affordable ways for local residents to get onto the property ladder. It’s also great to be working with Northampton Borough Council and Barry Howard Homes.
It is dream of many to be able to own their own home, and we have already provided homes in partnership with Rentplus at Kingsthorpe and Earls Barton and they have proved immensely popular and I’m sure these homes on Towcester Road will be no different”.
Steven Collins, CEO at Rentplus, said: “Affordability of housing is an issue across the country, and we are so please to be able to again offer an affordable rent to buy option to make dreams become a reality in Northamptonshire.
“These much needed new homes will make a vital contribution to helping the area’s working families onto an affordable pathway to homeownership without the need for the upfront deposit”.
Barry Howard added: “Owning your own home is the ambition of the majority of people in this county and we are so pleased to be able to offer an affordable rent to buy option in Northampton to make dreams a reality for local people.”
Any aspiring homeowners looking for rent-to-buy must be working and have local links to the area. They can find more information about how to apply at www.greatwellliving.org.uk/rent-to-buy.
Rentplus Chief Executive, Steve Collins, welcomed Sarah’s appointment. “Rentplus believes that every family dreaming of owning their home should have the opportunity to buy. Sarah will help our key and essential workers, and other lower and middle income earners, to realise their dreams across Essex and the South East.”
Rentplus buys new homes from developers, leasing them to housing associations who benefit from the rental income and increased portfolio, without needing to raise funds. Working with local authorities, most of our residents are drawn from the local housing lists, or move from social housing into a Rentplus home, freeing them up for reallocation.
Rentplus families move into a brand new home without having to pay one penny of deposit. They pay affordable rent for five to 20 years, until they are in a position to buy the home they are living in. And after five years, when they will have saved and built up a good credit rating, they have the chance to buy their home. At the point of sale, Rentplus gifts them 10% of the value of the home they are living in towards their deposit.
Sarah has a background in social housing, both with a housing association, Moat, and with L&Q, where she worked across a variety of roles. She is a member of the CIH and joins a team of area managers now stretching from the south of the country all the way to the north of England.
Sarah said: “Rentplus can make a real difference to families who want to own their own home. Many can afford the mortgage payments which may well be less than their private rent, but because they have been unable to save the huge amounts needed for deposits, even for shared ownership, they are denied access to homeownership.
“I am excited to be working with Rentplus to eliminate that barrier and I look forward to working with colleagues in social housing and the property sector across the south east to make this happen.”
Midlands area manager for Rentplus, Priya Vadgama, talks about why she thinks the Midlands is ripe for a housing revolution to benefit lower paid workers.
Rentplus has published research which revealed the full impact of COVID-19 on aspiring homeowners and, in particular, our key workers. It showed three in 10 (29%) key workers say COVID-19 crisis has made home ownership less achievable and that 72% of Birmingham residents would support initiatives which provide extra support.
“Our research found that over a third (38%) of all NHS and key workers say they have less money as a result of the pandemic, putting home ownership that bit further out of reach, especially when you consider that saving for a deposit (29%) tops the challenges for key workers when thinking about buying a home.
“The problem has been made worse with the pandemic pushing building societies to ask for bigger deposits – 15% or 20% and some even 40%. This is making it impossible for those on low incomes to raise a deposit, and Government schemes to help first time buyers, such as shared ownership and Help to Buy, have fallen short of helping those it sought to support.
“It comes as no surprise to me that the people of Birmingham and the West Midlands would support initiatives which provide extra support to help people onto the housing ladder, given the pure hard work and commitment that key workers have shown over this difficult year. Of those surveyed, 25% said the public sector should pay, 5% the private sector, and 57% that it should be a mix of private and public
“Rentplus believes that everyone deserves the right to their own home. There’s a real need to increase the use of creative approaches if we are to make any progress at real scale to give our valued key workers the opportunity to own their own home, and this is something the people of the region support.
“And that is where Rentplus can help.
“Rentplus is a route to home ownership that requires no upfront deposit. Residents move into a brand new home without having to pay a penny in deposit – thus removing the biggest barrier to homeownersip. Over 50% of our residents are key or essential workers. They’ve told us that they were not in a position to save even £10 a month, so raising the average £32,200 deposit required for Birmingham would have be impossible.
“The average income for Rentplus households is also lower than other government supported schemes. Our average household income is £32,600 compared to the £52,000 for those benefitting from Help to Buy.
“Rentplus homes are managed by regulated housing association partners. Residents pay an affordable rent set by the council (usually 80% of the private rental market costs). They pay no repairs or maintenance for the period they rent. They can choose to rent for 5-20 years. The initial 5 years gives them a chance to repair their credit history and to start to save. Where we have had tenants in homes for nearly 5 years, over 90% are on target to transfer from being a renter to being a homeowner. When they are ready to buy, Rentplus will gift them a further 10% of the sale price towards their deposit.
“I want to see families and working people given the chance to rent a property for between five and 20 years, to start to save, repair their credit rating and most importantly, to live in a community they want to be in and want to raise their family in.
“That’s why I am working hard, talking to housing developers, to local housing associations and to councils across the region to ensure that Rentplus’ unique affordable rent-to-buy proposition is made available to those on lower or middle incomes, without savings to give everyone a place they can call their own.”
If you are a developer, a registered provider or a local authority, you can contact Priya by emailing [email protected]
Notes
*https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/housepriceindex/june2020
***https://www.ft.com/content/88d1274f-e414-4444-9bc7-d7c97c5cfb26
The research was conducted by Opinium Research between 28 August and 2 September among 2,000 UK adults.
Steve Collins, Chief Executive of Rentplus, the leading affordable rent to buy provider, commenting on today’s news that the Ministry of Housing, Communities and Local Government has not delivered any of the 200,000 ‘Starter Homes’ for first-time buyers
“News that the Ministry of Housing, Communities and Local Government has not delivered any of the 200,000 ‘Starter Homes’ for first-time comes as Homes England reports a 34% decrease in affordable home ownership schemes over the last six months. MCHLG has also admitted it holds no data on the number of people who have transitioned to full home ownership under Shared Ownership, yet the tenure makes up over a third of all homes delivered by Homes England since 2015.
“These figures are a fresh blow for aspiring home owners, as the Government continually fails to meet the needs of this group. As a result, there is potentially a much greater role that privately funded providers can play in boosting the overall number of homes for first-time buyers with no reliance on Government funding.
“Schemes such as affordable rent to buy are already providing a much more accessible route to full ownership with tenants buying their home outright at a set five 5 yearly interval without needing a deposit to move into the house they will buy. The Government and local authorities should take note and do more to support these schemes, encouraging their development on a much wider scale to meet the home ownership ambitions of many more people.”
“These statistics show that the affordable housing crisis is getting worse rather than better, with a 15% fall in affordable home ownership completions for schemes other than shared ownership, nowhere near enough to satisfy demand.”
“It is those such as key workers, many of whom are on low incomes, who suffer the consequences of this undersupply, particularly given that shared ownership schemes are not suitable for everyone. It is vital that the government recognises the need for privately funded providers of affordable homes, such as Rentplus, which can deliver new homes without the need for any public loan or grant and play a key role in getting aspirant home owners on the housing ladder .”
Last month, Rentplus published research we had commissioned which revealed the full impact of COVID-19 on aspiring homeowners and in particular, on our key workers. It showed three in 10 (29%) key workers say COVID-19 crisis has made home ownership less achievable and that nearly 70% of those living in Leeds would support initiatives which would provide extra support to help our key workers onto the housing ladder.
Our research found that over a third (38%) of all NHS and key workers say they have less money as a result of the pandemic, putting home ownership that bit further out of reach, especially when you consider that saving for a deposit (29%) tops the challenges for key workers when thinking about buying a home.
The problem has been made even worse with the pandemic pushing building societies to ask for even bigger deposits – 15% or 20% and some even talking about 40%. This is making it impossible for individuals and families on low incomes to raise a deposit, and Government schemes to help first time buyers, such as shared ownership and Help to Buy – have clearly fallen short of helping those it sets out to support.
It comes as no surprise to me that the people of Leeds would therefore get behind initiatives which provide extra support to help people onto the housing ladder, given the pure hard work and commitment that key workers have shown over this difficult year. Of those surveyed, 24% said the public sector should pay, 7% the private sector, and 51% said it should be a mix of private and public.
I believe there’s a real need to increase the use of creative approaches if we are to make any progress at real scale to give our valued key workers the opportunity to own their own home, and this is something the people of Leeds support.
And that is where Rentplus can help.
Rentplus is a route to home ownership that requires no upfront deposit. Our residents move in to a brand new home without having to pay a penny in deposit – thus removing the biggest barrier to homeownersip. Over 50% of our residents are key or essential workers and they have told us that they were not in a position to save even £10 a month, so raising a £30,000 deposit would have been impossible.
Our homes are managed by regulated housing association partners. Residents pay an affordable rent set by the council (usually 80% of the private rental market costs). They pay no repairs or maintenance for the period they rent. They can choose to rent for 5-20 years. The initial 5 years gives them a chance to repair their credit history and to start to save. Where we have had tenants in homes for nearly 5 years, over 90% are on target to transfer from being a renter to being a homeowner. When they are ready to buy, Rentplus will gift them a further 10% of the sale price towards their deposit.
I want to see families and working people given the chance to rent a property for between five and 20 years, to start to save, repair their credit rating and most importantly, to live in a community they want to be in and want to raise their family in.
That’s why I am working hard, talking to housing developers, to local housing associations and to councils across the region to ensure that Rentplus’ unique affordable rent-to-buy proposition is made available to those on lower or middle incomes, without savings.
If you are a developer, a registered provider or a local authority, you can contact Alasdair by emailing [email protected]
Notes
*https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/housepriceindex/june2020
***https://www.ft.com/content/88d1274f-e414-4444-9bc7-d7c97c5cfb26
The research was conducted by Opinium Research between 28 August and 2 September among 2,000 UK adults and 500 NHS/key workers
He added:
“However it is an omission not to mention that there are existing successful models which assist people from social housing into home ownership without any recourse to public funds. For example 17% of our Rentplus tenants come directly from social housing and in some areas, this is as high as 50%.
“Complementary models such as affordable rent to buy exist and can be delivered alongside government schemes. Affordable rent to buy is part of the answer to the affordable housing crisis and the Government should recognise it as such.”
November 2020
You can read the Rentplus response to the Inquiry here
“Many of these people are keyworkers; our nurses, care assistants and supermarket workers who continue to serve on the frontline during this pandemic and who want the chance to own their own home.
“With eye-watering house prices and rising private rents, it is virtually impossible to save for a deposit, and with that the possibility of home ownership moves further away.
“That’s why we gift a 10% deposit to help overcome what is for some, an insurmountable hurdle.”