Low Cost Home Ownership
What is Low-Cost Home Ownership?
Low cost Home Ownership is where a planning obligation has been placed on a private developer to sell homes below the open market price (normally 70-85% of the market) to households nominated by the District Council, from the Housing Needs Register. Low Cost Home Ownership means that you only deal financially with your mortgage lender and secure a mortgage in the usual way
How can I qualify?
In order to be considered for Low Cost Home Ownership, you must first register on the District Councils Housing Needs Register.
If you are in housing need you may be put forward, if you are unable to afford to buy a home at normal market price but would be able to maintain mortgage repayments on a reduced-rate property. It would also depend upon whether the type and size of home that you need was included on the scheme. In most cases, the scheme is only open to first time buyers, as it is intended to be a stepping stone towards owner occupation for those who currently cannot afford this housing option.
What if I sell the property?
When you sell the property, due to the restrictive covenant, you must sell for the fixed percentage of the value. A local estate agent can carry out the valuation for you, and this figure needs to be agreed with the District Council. You will not be allowed to sell the property, as the District Council retains nomination rights to Low Cost Home Ownership homes and will therefore be able to recommend a potential purchaser to you. It is important that you notify the District Council of your intention to sell immediately.
Other costs which must be considered?
Buying a home, even through one of these things is still an expensive process. As well as being able to raise a mortgage, applicants will be liable for other costs. These include :
Deposit: To register your interest in a property, the payment of a reservation fee will be required. This amount will then be deducted from the purchase price upon completion. This is normally a percentage of the value of the property.
If you change your mind and decide not to purchase after solicitors have been instructed, you may lose your deposit, and need to pay a charge to allow the housing association to cover their administration costs.
Legal Costs: You will need to instruct a solicitor to act on your behalf. It is advisable to request an estimate of the charges prior to taking their services. There will be fees payable to the land registry. Also, if the full purchase price of the property is £60,000 or more you will need to pay stamp duty.
Valuation costs: The mortgage lender will require a valuation to be made of the property you intend to buy. You will be directly responsible for any the costs that will be involved with this. Your mortgage lender may also charge an administration fee for which you will also be responsible.
We recommend that you seek professional advice on the above.
Low cost Home Ownership is where a planning obligation has been placed on a private developer to sell homes below the open market price (normally 70-85% of the market) to households nominated by the District Council, from the Housing Needs Register. Low Cost Home Ownership means that you only deal financially with your mortgage lender and secure a mortgage in the usual way
How can I qualify?
In order to be considered for Low Cost Home Ownership, you must first register on the District Councils Housing Needs Register.
If you are in housing need you may be put forward, if you are unable to afford to buy a home at normal market price but would be able to maintain mortgage repayments on a reduced-rate property. It would also depend upon whether the type and size of home that you need was included on the scheme. In most cases, the scheme is only open to first time buyers, as it is intended to be a stepping stone towards owner occupation for those who currently cannot afford this housing option.
What if I sell the property?
When you sell the property, due to the restrictive covenant, you must sell for the fixed percentage of the value. A local estate agent can carry out the valuation for you, and this figure needs to be agreed with the District Council. You will not be allowed to sell the property, as the District Council retains nomination rights to Low Cost Home Ownership homes and will therefore be able to recommend a potential purchaser to you. It is important that you notify the District Council of your intention to sell immediately.
Other costs which must be considered?
Buying a home, even through one of these things is still an expensive process. As well as being able to raise a mortgage, applicants will be liable for other costs. These include :
Deposit: To register your interest in a property, the payment of a reservation fee will be required. This amount will then be deducted from the purchase price upon completion. This is normally a percentage of the value of the property.
If you change your mind and decide not to purchase after solicitors have been instructed, you may lose your deposit, and need to pay a charge to allow the housing association to cover their administration costs.
Legal Costs: You will need to instruct a solicitor to act on your behalf. It is advisable to request an estimate of the charges prior to taking their services. There will be fees payable to the land registry. Also, if the full purchase price of the property is £60,000 or more you will need to pay stamp duty.
Valuation costs: The mortgage lender will require a valuation to be made of the property you intend to buy. You will be directly responsible for any the costs that will be involved with this. Your mortgage lender may also charge an administration fee for which you will also be responsible.
We recommend that you seek professional advice on the above.
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