Home Ownership & Intermediate Markets. Andrew Brader Senior Sales & Marketing Officer Orbit Homes

Transcription

1 Home Ownership & Intermediate Markets Andrew Brader Senior Sales & Marketing Officer Orbit Homes

2 Introduction to Orbit Homes Biggest HomeBuy Agent in country (Norfolk, Suffolk, Cambridgeshire, Bedfordshire and West Midlands) National leader in Mortgage Rescue, operating in above areas Continuing to deliver 750 affordable homes a year ; and LCHO and open market Sales and Marketing

3 What this workshop will cover The HomeBuy products Rent to HomeBuy

4 Affordable Homeownership products through the years New Build HomeBuy (also known as shared ownership/part rent/part buy) Intermediate Rent HomeBuy Open Market HomeBuy Expanded Open Market HomeBuy MyChoice HomeBuy Ownhome HomeBuy Direct First Time Buyers Initiative (FTBi) Rent to HomeBuy

5 HomeBuy Products Currently Available New Build HomeBuy (also known as shared ownership/part rent/part buy) Intermediate Rent Rent to HomeBuy

6 Eligibility Social Tenants Key Workers First Time Buyers Returners to the Market, many due to relationship breakdown Others in Housing Need Household income of less than 60K

7 New Build HomeBuy Specific properties built or procured by RSLs Share purchased between 25% and 75% Purchaser pays subsidised rent on remaining share Occupancy cost approximately 30% less than purchasing outright Can purchase further shares (staircase) Can sell share Property is leasehold

8 Intermediate Rent Assured Shorthold Tenancy Intermediate Market Rent paid (80% of Market Rent) Customers must demonstrate an ability and desire to purchase after 5 years

9 Rent to HomeBuy Helps people get onto the homeownership ladder by allowing them to rent a home first and then buy it later

10 Rent to HomeBuy Assured Shorthold Tenancy for 5 years Intermediate Market Rent paid (80% of Market Rent) Option agreement to purchase on shared ownership basis can choose the share size they purchase Customer signs up to a savings plan to build up their deposit

11 What are the advantages of Rent to HomeBuy? First time buyers unable to secure a mortgage No deposit Uncertain about buying in the current economic climate Customer builds up deposit over tenancy term

12 Orbit Homes Rent to HomeBuy Scheme 140 units of unsold New Build HomeBuy 31 st Oct 08 Launched scheme in November 2008 on 20 sites mainly in the Midlands Local authority commitment to scheme

13 Orbit Homes Rent to HomeBuy Scheme Rent to HomeBuy marketed as a home purchase scheme Savings incentive Orbit Homes will match tenant s savings up to a max of 5% of a 50% New Build HomeBuy purchase Eligibility and affordability assessed as for New Build HomeBuy

14 Orbit Homes Rent to HomeBuy Scheme Household income of 60K or less Income and Expenditure assessment carried out Local authority or HomeBuy Agent nomination obtained

15 Orbit Homes Rent to HomeBuy Scheme Orbit Homes reserves the right not to sell to the tenant if the property value has fallen by 5% or more at the time the tenant wishes to take up the option to purchase

16 Rent to HomeBuy Scheme Tenancy Management Repairing obligation We contact the tenant every six months to check on the progress with their plans to purchase their home

17 Rent to HomeBuy Scheme Performance In 09/10 we have had 49 Rent to HomeBuy move ins We declined 43 applications because the applicant was assessed as not able to afford to purchase the property

18 Rent to HomeBuy Scheme Performance The Rent to HomeBuy scheme had a positive impact on our New Build HomeBuy sales increase in sales on schemes marketed for Rent to HomeBuy Improving prospects for purchase as the mortgage market slowly improves

19 Rent to HomeBuy Should it be a permanent addition to the suite of HomeBuy products and why? Any pros/cons with the product?

20 Rent to HomeBuy How many households will move into homeownership? Cheap rent option? Difficulties in selling a second hand property? Some lenders do not allow the 5% cash back that we offer to match client s savings to be used as a deposit.

21 Rent to HomeBuy Option to purchase agreement reserve right not to sell if market value fallen by 5% or more Access to mortgage finance in the future How the properties are managed What happens if a client can t purchase after 5 years? Market rents could fall

22 Any questions or comments? Thank You for listening