Buying a home through New Build HomeBuy (part buy, part rent) Sustainable homes, sustainable communities
The New Build HomeBuy Scheme If you want to buy a home of your own but don t quite have enough money to do so, New Build HomeBuy could be the answer... We have written this leaflet to answer the questions you may have about the scheme. If we haven t provided the answers you need, or you would like to talk to one of our team, please call 0800 783 3097. What is New Build HomeBuy? New Build HomeBuy is a government introduced scheme to help those who cannot afford to buy a home outright. This may be because they cannot afford the full mortgage repayments, the deposit or both. If this describes your position, we may be able to help. With this scheme you buy a share in the home and pay a subsidised rent on the remainder. As and when your finances allow, you may buy a greater share until you own your home outright. However, you need to check with the sales team as many of Hastoe s rural developments have restricted staircasing (the size of share you can go up to) to 80%. This is to ensure the property always remains in low cost ownership. How does it work? A valuer will provide a valuation for the home and you will pay a proportion of that value depending on the size of share you are buying. The minimum share you will be expected to buy depends on the type of scheme being offered, your salary and any savings you have. Your share may be as little as 25% or as large as 75%. Hastoe will then charge you rent for the remaining share and a service charge. Rent is charged at no more than 2.75% of the unsold share. The service charge covers costs such as buildings insurance and estate maintenance. If, over time, you buy more shares and end up owning your home, you would no longer pay rent but may continue to pay a service charge.
Hastoe New Build HomeBuy Scheme Do I qualify? If you are finding it hard to get on the property ladder it is worth checking to see if you are eligible for New Build HomeBuy. The government has set out the following as a guide to who has priority: l First time buyers l Key Workers l Council and housing association tenants l Other priority groups including those who live in overcrowded homes. As most of our New Build HomeBuy properties are in rural areas, it is also likely that you will need to prove a local connection to the parish in which the homes are built, or the surrounding area. Generally, local connection means you: l Currently live in the parish l Were previously living in the parish but were forced to move away because of a lack of affordable housing in the area l Have close family who live in the parish l Have permanent and full time employment in the parish. Hastoe will ask the Parish Council to verify the local connection information provided. In addition to the local connection, applicants must demonstrate a housing need. If your income is high enough to enable you to buy a house on the open market then you are not in need and these houses are not meant for you. How large a home could I get? Homes will generally be offered on the following basis: Single applicants one bedroom Joint applicants one or two bedrooms Couples/single parent families with one child two bedrooms Couples/single parent families with two children three bedrooms Couples/single parent families with three children four bedrooms
5 Steps to buying your new home Step 1: Registering If you would like to apply for a New Build HomeBuy home you will need to registered with the HomeBuy Agent for your area (see the back of this leaflet). You may also need to register with your local housing department or parish council. If you do not know who this is, please contact us and we can help point you in the right direction. You can also register your interest in a Hastoe scheme directly with us. Step 2: Viewing and allocating When you have been accepted onto the HomeBuy Agent waiting list, your details will be supplied to us in the form of a list of those registered in the area by the HomeBuy Agent. Hastoe will send out a leaflet and schedule of the costs involved with a letter inviting you to express interest in properties in your area. Following this, an assessment will be arranged to confirm your local connection and to ascertain if you are able to obtain a mortgage. If you are successful you will be offered a property and invited to view it. Our sales team will send you an offer letter and information pack containing an acceptance form. You will have one week to complete and return the form. You may also be required to pay a reservation fee of 500 should you accept the offer. Step 3: Accepting the offer You will need to complete the Acceptance of Offer form providing us with details of who your mortgage lender and solicitor are. We will ask you for certain documentation including: l Proof of local connection such as electoral register details l Bank statements l Council tax bill l Savings statement l Salary slips l P60 (or accounts if self-employed) l Passport l Utility bills l Key worker status (if required) l Tenancy agreement or housing waiting list number. Once we have received this documentation we will send you a Memorandum of Sale. This contains details about the sale and is sent to you, your solicitor, your financial advisor and our solicitor. From this point onwards, any reservation fee is non-refundable.
Hastoe New Build HomeBuy Scheme Step 4: Conveyancing This is the legal process of transferring the ownership of the property to you. This will involve your solicitor checking all of the legal documents, including the title deeds and lease. Your solicitor will also check with the local authority to make sure there are no known planning applications that would affect the value of your home. Step 5: Exchange of contracts and completion When your solicitor has completed the legal work you will be given a report detailing the findings of the conveyance. You will be asked to sign a contract and we will sign an identical one. These will then be exchanged and you will then be committed to buying your home. For the exchange to happen, your solicitor will need a copy of your mortgage offer. You will need to transfer your deposit to your solicitor s account before completion can take place. Upon completion as well as the mortgage money, you will be expected to pay the first month s rent and service charge to Hastoe in advance. Completion will happen on a date agreed by the solicitors in consultation with you and us. This could take anything from a day to two weeks from the exchange of contracts. Our solicitors will call us when your mortgage money has been transferred to us via your solicitors. We will then call you when to let you know you can collect your keys and move in!
Money matters How much money do I need? Your household income should be sufficient to meet the costs of New Build HomeBuy (see below) but not enough that you could buy outright on the open market. You must have some savings or show us that you have access to the necessary funds. What are the costs? l A mortgage valuation and arrangement fee Your mortgage lender will insist on carrying out its own valuation of the home and will charge you for arranging your mortgage. l Legal fees We strongly recommend that you instruct a solicitor to act for you. We can provide a list of solicitors who understand New Build HomeBuy. We will prepare a contract which, when signed by you and us, is legally binding. l Stamp duty The rules on stamp duty change from time to time. Your solicitor will advise you. l Deposit There will be a minimum deposit required, depending on the value of the home. l Land registration fee This charge is set by the Local Authority and will be different depending on the area you are purchasing in. l Mortgage insurance Your mortgage company may insist on this.
Hastoe New Build HomeBuy Scheme What about regular household bills? You will be responsible for a number of household costs including: l Council tax l Water and drainage l Gas l Electricity l Contents insurance. Will costs change over time? You need to consider your costs in two parts mortgage and rent. l Your mortgage may go up or down depending on interest rates and the type of mortgage you have. l Your rent is reviewed each year and will increase in line with the Retail Price Index. What happens if I miss mortgage payments? Your mortgage is covered by a contract between you and your bank or building society. If you fall behind with your payments the bank or building society may take possession of your home and then sell it, to get its money back. What happens if I miss rent or service charge payments? Your rent is covered by a contract between you and Hastoe. If you fall behind with your rent we may go to the courts to have your lease forfeited. Remember, you may be entitled to housing benefit if your income is reduced.
Increasing your share How do I buy further shares in my home? Living in your home Who pays for repairs? If your home is a house, you will be responsible for all internal and external repairs and redecoration. We will insure the structure of your home and you will have to pay a service charge to cover this and to cover the cost of rent collection. If your home is a flat, you will be responsible for all internal repairs and redecoration. We will undertake to keep the building in good structural repair. We will also insure the structure and keep any common parts such as the staircase and corridors decorated, cleaned and lit. You will pay a service charge to cover these costs. We will tell you how the service charge is spent and will consult you before doing any major repair or maintenance work. You should note that you will be given a certificate from the National House Builders Council or equivalent. This means the builders are responsible for remedying any defects due to their workmanship or materials which arise in the twelve months from the date the properties are handed over to Hastoe. Can I make improvements or alter my home? You will need to get our written consent before doing any work. If we do give our consent and the work increases the value of your home, such as a conservatory, you will get the full benefit of the value when you sell. This is because when you sell, we value the home as it was sold to you. Your solicitor will explain how this works. If you wish to put up a satellite dish, you must seek our agreement first (due to conditions within the planning agreement). Can I let or sub-let my home to someone else? No. You may not sub-let the whole of your property as the tenancy says it must be your only or principal home. You may, if you wish, purchase further shares in your home, up to a maximum of 80% or 100% depending on the restrictions within your lease. If you wish to do this, you will need to write to us. Once we get your letter, we will arrange for your home to be re-valued by an independent valuer. You will have to pay the cost of this. If you decide to proceed with buying more shares you would then need to appoint a solicitor. If you do buy more shares, your rent would decrease accordingly.
Hastoe New Build HomeBuy Scheme Selling your home What do I have to do if I want to sell? If you want to sell your home you need to write to us. We will then appoint an independent professional valuer who will value your home. You will have to pay for this valuation. You will have to sell on the same percentage as you own, so if you own 40% you must sell 40% of the value. Who can I sell to? Once the value has been set, we have two months to nominate someone to whom you can sell your lease. If the sale to the first person falls through, we offer the sale to the next person and so on. If we are unable to find any nominees within the two months, you may find a buyer yourself but they would have to be a local person, where necessary, and approved by us. We are entitled to a fee of 0.25% of the total market valuation to cover the cost of finding someone to buy from you. You will not, of course, need to pay for an estate agent who would generally charge between 1% and 2%. Is there anything else I need to do? You will need to arrange for a Home Information Pack (HIP) on your home before we can market it to potential purchasers.
Example breakdown of costs Figures based on house valued at 150,000 with purchaser buying 50% share. Buying costs Deposit 7,000 Mortgage 68,000 (therefore rent paid on remaining 50%) Rent Service charge 171.90 per month 20.00 per month Other costs (examples only) Reservation fee 500 Solicitor 700 + VAT Solicitor s costs Searches 100 to 300 Land registry 100 to 300 Stamp duty (if applicable) Based on value of home Lender s fees 400 Valuation fee 200 Removal costs 150 (plus first month s rent and service charge)
Hastoe New Build HomeBuy Scheme HomeBuy Agents Bedfordshire, Cambridgeshire, Norfolk and Suffolk Orbit Tel: 0345 850 2050 www.orbithomebuyagents.co.uk Kent, Sussex and Essex Moat Tel: 0845 359 6161 www.moat.co.uk Hertfordshire Lea Valley Homes Tel: 0158 286 9440 www.leavalleyhomes.co.uk Hampshire Swaythling Housing Tel: 0238 062 8004 www.homesinhants.co.uk Lincolnshire EM HomeBuy Tel: 0844 892 0112 www.emhomebuy.org.uk East, North and West London Metropolitan Housing Group/Housing Options Tel: 0845 230 8099 www.housingoptions.co.uk Avon, Cornwall, Devon, Dorset, Gloucestershire, Somerset and Wiltshire South West Homes Tel: 0300 100 0021 www.southwesthomes.org.uk Berkshire, Oxfordshire, Buckinghamshire, Milton Keynes and Surrey Catalyst Tel: 0845 601 7729 www.catalysthomebuy.org.uk South East and South West London L&Q Tel: 0845 230 8099 www.housingoptions.co.uk HomeBuy Agents do change from time to time. Please see: www.homebuy.co.uk for the latest information.
Sustainable homes, sustainable communities For further details of how New Build HomeBuy works, eligibility criteria or properties available please contact sales@hastoe.com or call 0800 783 3097. Contact Details Hastoe Housing Association www.hastoe.com South and Head Office Marina House 17 Marina Place, Hampton Wick Kingston upon Thames Surrey KT1 4BH Lo-call: 0845 702 3271 Tel: 020 8973 0394 Fax: 020 8943 2163 Email: south@hastoe.com or for head office: Email: info@hastoe.com West Office Fleur de Lis Middlemarsh Street Poundbury, Dorchester Dorset DT1 3GX Lo-call: 0845 601 8865 Tel: 01305 250103 Fax: 01305 250106 Email: west@hastoe.com East Office Rectory Farm Barns Little Chesterford Saffron Walden Essex CB10 1UD Lo-call: 0845 601 9043 Tel: 01799 533490 Fax: 01799 531039 Email: east@hastoe.com Printed on recycled paper Hastoe Ref: 00053/10/10/BRC/V2