A new scheme is set to be launched in Wolverhampton to help people make the dream of owning a home a reality.
‘Help to Own’ will provide the opportunity for local people to get on the property ladder without a deposit and ultimately buy their home for £1 on expiry of their lease.
City of Wolverhampton Council, West Midlands Combined Authority and Frontier Development Capital Ltd (FDC), a fund management business, are finalising legal agreements prior to launching the pioneering regional home ownership scheme, to create an ideal first step on the property ladder for Covid-19 keyworkers and others.
It will enable tenants to rent a quality new-build home for the long-term. As they make their monthly payments the scheme anticipates they will build up a Loyalty Premium. Tenants can take their Loyalty Premium as cash if they leave the scheme within the first 20 years, or alternatively use it to get a tenancy for another five years and buy their home for £1 on the 25th anniversary.
The Help to Own partnership will pilot the scheme by purchasing 100 homes for £20.8million onThe Marches sitein Wednesfield – being developed by the Council’s own housing company, WV Living.
The scheme has only been possible as result of the partners coming together and sharing the cost.
Help to Own on this demonstrator project has the potential to offer hardworking families, including key workers, access to high-quality 2, 3 and 4-bedroom houses located in a prime position for transport links and New Cross Hospital, without the need for a deposit.
Following the pilot the intention is to roll the scheme out regionally and nationally.
City of Wolverhampton Council Leader, Councillor Ian Brookfield, said:
“We are delighted our city will be the first to launch this ground-breaking scheme that will give local people the opportunity to get on the property ladder and own new, quality homes.
“It is a new plan for homeowners, which aims to make home ownership more accessible.
“Under this scheme homes will also be prioritised at the Marches for key workers – people like our fantastic NHS frontline staff just down the road at New Cross Hospital, who have protected our city during the Covid-19 pandemic.
“We are in a great position to bring forward a scheme like this because the Council has its own well-established housing company, WV Living.
“WV Living is delivering high quality homes at the Marches and across the city to help speed up the delivery of new homes, using vacant sites overlooked by private sector developers.
“As a Council we are committed to delivering more and better homes for all and this pioneering ‘Help to Own’ scheme is not only a fantastic opportunity for local people to benefit – but could also be a game changer in home ownership nationally.”
Help to Own has been created by FDC, a fund manager headquartered in Birmingham.
Andy Street, the Mayor of the West Midlands and chair of the WMCA, said: “Over recent years the West Midlands has undergone a housebuilding revolution, and this is the next part of our plans to make home ownership more realistic for people across the region.
“Since 2011 we have doubled the number of homes being built, unlocked huge swathes of brownfield land for these homes to be built on rather than precious greenbelt land, introduced a mandatory 20% minimum affordable clause for any developments involving WMCA cash, and re-defined the definition of affordability so it is linked to people’s income rather than the market rate of housing. But we still have an issue of not enough people being able to afford their own home.
“That is why I am delighted we will be introducing the Help to Own scheme, which will allow people in Wolverhampton to choose to get their hands on a home for just £1 at the end of their 25-year tenancy. This is an incredibly innovative and pioneering scheme that I hope will soon roll out to the rest of the West Midlands and set a path for other parts of the country to follow.
“Perhaps the most exciting part of this scheme is that homes will be prioritised for key workers, including our wonderful NHS staff, which is a fitting way to thank those who have been on the frontline against the coronavirus pandemic for more than a year.”
Sam Miller, Commercial Director – New Propositions at FDC said: “Help to Own has been a long time in the making and our vision is clear; we want to support Generation Rent to get on the property ladder. Ever-increasing rents and soaring house prices are making it incredibly challenging for people to save for a deposit, so we’re delighted to be partnering with WMCA, CWC and WV Living to finalise and launch Help to Own via the Marches development.
The scheme requires no deposit, offers a secure yet flexible long-term tenancy, and intends to enable tenants to create value over time. Ultimately the scheme anticipates people will be able to choose to buy their home for £1 on their 25th anniversary. We believe these features make it a truly innovative housing product”.