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Is There Any Help For UK First-Time Home Buyers In 2021?

Several government programs will assist you in purchasing a house. Help to Buy, Right to Buy, and Shared Ownership are some of these options. Learn more about them and how to submit a request in this post.

  • Buying Assistance
  • Shared rights and the right to buy/acquire
  • Individuals with disabilities
  • Senior citizens
  • In Scotland, Wales, and Northern Ireland, the government offers home ownership programs.
Help To Buy

Many that have a small down payment may be considered for the Help to Buy scheme:

First-time buyers and potential homeowners who wish to purchase a ‘new construct’ house under the applicable municipal price limit may apply for an equity loan.

This will only be used to purchase your primary residence; it cannot be used to purchase a second home or a rental house.

A investment of at least 5% of the purchase price is needed. You will borrow up to 20% of the selling price (or 40% in London). For the next five years, this money will be interest-free. For the first five years, there is no interest on the equity loan. In year 6, you begin paying interest on the equity loan balance you lent. You can not lower the amount you owe and the equity debt fees are interest only.

You will pay off the equity loan in full or in part at any time. A portion payment shall equal at least 10% of the value of your home at the time of repayment.

Right To Buy

Right to Buy and Right to Acquire are two government programs that enable council and Housing Association residents to register to buy their homes at a reduced price. You must satisfy the qualifications criteria to be eligible for either program.

The amount of the reduction depends based on where you reside and the market value of the home you choose to purchase.

Tenants who lived in a council home until it was sold to a certain landlord, such as a housing association, could be entitled to purchase it under the ‘Preserved’ Right to Buy or Right to Acquire programs.

Typically, renters must be leased for three years from the public sector (e.g., a local authority, a housing agency, the armed forces, the NHS, or a foundation trust) before they can purchase under these schemes.

Three years do not have to be consecutive. So, if you rented from the private sector in between periods that you rented from the public sector, you may still be qualified.

Shared Ownership

You buy a share of a house from the landlord, who is either the council or a housing association, and rent the rest.

To account for your part, which will range from a quarter to three-quarters of the property’s entire value, you’ll need a loan.

You then pay a lower rate for the portion of the building that you don’t own. You may later opt to purchase a larger portion of the stock, up to 100% of its value.

Adjustments to the system were implemented in April 2021 as part of the government’s new Affordable Homes Program, that included:

  • The initial share requirement has been lowered from 25% to 10%.
  • You must now be a first-time buyer with an average household income of less than £80,000, which is lower than the previous requirement of £90,000 in London.
  • Property owners will now buy additional shares in 1% increments rather than the previous 5 or 10%.
People with disabilities

If you have a long-term condition, Home Ownership for People with Long-Term Disabilities (HOLD) will assist you with purchasing any property that is for rent on a Shared Ownership basis.

Priority is provided to military members above all other categories. Only England will be covered by the plan. However, depending on municipal housing priorities, councils with their own shared ownership home-building programs which have certain priority categories.

Just qualify for hold if the homes accessible by other homeownership programs do not satisfy the requirements, such as if you require a ground-floor residence.

Older people

If you’re 55 or older, you might qualify for another home ownership program called Older People’s Shared Ownership.

It functions similarly to the general Shared Ownership arrangement, except that you can only own up to 75% of your house. You won’t be paying rent on the remaining 25% until you own 75%.

Co-Ownership in Northern Ireland

This arrangement is only applicable in Northern Ireland, and it applies to both recently constructed and older houses.

You purchase between 50% and 90% of the house (known as the ‘starter share’). You have the option to raise your share at any time (this is known as staircasing). On the part you don’t own, you pay rent.

If you’re looking for a different way to buy a house, online property platforms like DealSourcing have search filters that let you set up for the key criteria you’re looking for. Proptech technology is intended to make this process easier and offer a platform for personal property sourcers.

Thanks to algorithms and the force of optimization, the algorithm can discover houses all over the world and sort them in the market by a proportion of 10%, 15%, or even 40% below market value. You’ll also be able to choose properties with the highest Return on Investment (ROI), which determines how much money an individual will profit from their investment. It will save you time, money, and energy! You can check DealSourcing’s website here.

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