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Dorset is currently experiencing some of the highest house price growth in England. The latest ONS House Price Index shows that prices in Dorset have risen 8% on the year, reaching £289,789. This is3% higher than the UK average, amounting to nearly £65,000 extra which buyers need to find if they are to purchase a home of their own. At the same time the amount of money spent by the Government on building affordable homes has dropped significantly from £11 billion to £5 billion over the last six years.
Rentplus is working to combat Dorset’s affordability crisis through its affordable rent to buy model, which offers tenants an innovative and alternative solution to home ownership. Rentplus provides tenants with five year renewable tenancies at an affordable intermediate market rent, set at the lower of either 80% of market rent or the Local Housing Allowance cap for the local area, inclusive of service charges. Tenants have the opportunity to purchase their home at either year 5, 10, 15 or 20 and are given a 10% gifted deposit from Rentplus to enable them to do so.
The new homes, which will comprise a mix of one and two bedroom flats, and two bedroom houses, marks Rentplus’ second scheme in Dorset, with 33 units already complete in Sherborne, West Dorset. Together the schemes signify a significant step toward reaching Rentplus’ target of delivering 5000affordable rent to buy homes across the country by 2020.
Steve Collins, Rentplus CEO, commented: “Our second scheme in Dorset shows Rentplus’ commitment to addressing the problem of affordability in the area and providing an alternative route to homeownership for those who have no other options. As levels of home ownership across the UK hit a 30 year low and the affordability problem reaches crisis point, it is essential that we offer more innovative and flexible housing tenure options, to help hard working people own a home of their own.
“We are very pleased to be continuing our partnership with both Tamar Housing and Persimmon Homes on the development; another excellent example of how through collaboration we can deliver more much needed affordable housing. These new rent to buy homes will offer the tenants a secure home at an affordable rent, the chance to save money and ultimately purchase their own home in the future. All whilst helping North Dorset District Council accelerate its affordable housing delivery.”
Julie Barnett, Chief Executive, Tamar Housing, said: “We are delighted that our partnership with Rentplus will enable us to offer more new affordable rent to buy homes in the South West. We know that there is a huge demand for these homes and that initiatives such as Rentplus, which offers an alternative pathway to homeownership and security are crucial, especially at a time when thousands are unable to save enough for a deposit.
“It is fantastic to be able to play a role in combatting the UK’s affordability crisis, and we look forward to continuing to work with Rentplus to deliver many more affordable rent to buy homes in the area.”
The first tenants are expected to move in within the next few months.