L&Q aims rent to buy scheme at lower earners
Housing association London & Quadrant is looking to pilot a new funding model aimed at people earning between £12,000 and £25,000.
The scheme would allow people to rent at a sub-market level for five years, so they could save up to buy some or all of their home.
L&Q launched a similar scheme earlier in the year, UpToYou, which is open to people on higher incomes.
The association announced its new proposals at a fringe event at the Liberal Democrat party conference in Bournemouth.
Chief executive David Montague said the idea is to ‘provide something which gives more flexibility than a private rented sector home would currently provide, but we need to balance that with the need to attract private investment’.
He added: ‘At the moment people are concerned about security of tenure. Investment is heading towards a cliff, and there is a huge gap in the middle of the market.’
L&Q is looking for local authorities to get involved in pilot schemes, involving some of the 700 homes it has built this year, or 10,000 it has in the pipeline over the next seven.
Some delegate expressed concern about what might happen to tenants after five years if they were unable to buy a share of their home. L&Q said there would be some scope for modifying agreements, and the pilots would be used to work out the details.
Have your say
You must sign in to make a comment
Readers' comments (8)
kass | 21/09/2009 6:11 pm
this sounds too good to be true... How can anyone earning £12,000 a year be able to first rent and then buy a home?... Anyone has any more details how this is done in practice?
Unsuitable or offensive? Report this comment
Patrice | 21/09/2009 9:31 pm
There is something about being placed in an environment where a definite goal is set. On one hand you may argue that its no different to being in the priavet sector and saving towards a deposit and setting your 'own' goal to buy later on. The added benefit with the L & Q model would possibly be a lower market rent. There may be more flexibility ( I hope) to combine income with a family member or partner etc to buy after 5 years. if you seek to get a second income in order to buy you should save more, paying cheaper rent.lets hope its value for money
Unsuitable or offensive? Report this comment
teejay | 22/09/2009 9:57 am
By definition all shared ownership/rent to buy schemes are sub-prime. Why are we still seeking to 'force' people into home ownership when what is really needed are more affordable rented properties?
Unsuitable or offensive? Report this comment
teejay | 22/09/2009 10:08 am
PS! I have copied the following from the previous article: "Research from the Tenant Services Authority found only 12 per cent of social renters wanted to buy their own home, either through Right to Buy or on the open market, compared to 32 per cent a decade ago.
The study also found 92 per cent of shared owners had not bought more than their initial stake since they purchased their homes."
More affordable rented housing please, not more dodgy shared equity schemes!
Unsuitable or offensive? Report this comment
kass | 22/09/2009 10:32 am
Anyone good at counting pennies out there? In London you might end up spending close to £2K in a year just to travel to work and public transport. Then deduct the rent. Then living expenses. then a pint of beer a week (just one for the whole week, as your only luxury) Forget a night a the theatre (only one in the year) or to the opera and stick to watching telly if you wish any entertainment of any sort. Forget going one evening only to the restaurant too for the rest of your life. And tell me how can you rent and then buy a house with £12K... And even if you just about manage doing it - how long do you think will you be able to keep it on such income - provided you don't lose your job which in this climate is hundred per cent certain you will?...
The solution? Create well paid, long lasting jobs and allow them the freedom to buy the properties they really would wish to buy.
Unsuitable or offensive? Report this comment
Jay | 22/09/2009 12:12 pm
The only reason tenants do not want to take up their Right to Buy is they can no longer affor it, with the escalated house prices over the years and the reduction in discounts it is out of their reach. If houses were really affordable to the tenants I am sure many would like to buy. this would be a real inverstment for people on lower incomes and give them a sense of pride to keep the properties maintained and give them equal opportunity to buy just like anyone else. The problem with the lack of housing was not tenants taking up their Right to buy it was the lack of development of new stock. I believe that The Right to Buy should be improved and more accessible instead of all these crazy schemes we have at the present. If you cannot afford to buy then you cannot afford to buy and part rent. Why not improve the Right to buy and relate the discounts to income.
Unsuitable or offensive? Report this comment
kass | 22/09/2009 2:10 pm
teejay | Tue, 22 Sep 2009 10:08 GMT...
you should copy your 2 posts on this other news thread
Social tenants shun homeownership
where they mention tenants statistics
Unsuitable or offensive? Report this comment
Disappointed :( | 23/09/2009 6:48 pm
I have signed up with L & Q for the scheme rent to buy and so far the properties on offer are not in my salary bracket. Also I don't want a flat, have lived in flats for years and would like a house with a garden. I have not seen ONE advertised yet and the other properties as I've said before are all out of my salary range. Feel very let down by L & Q so far!!!!!!
Unsuitable or offensive? Report this comment