The Housing Hub launched to promote wider access to home ownership
It is no surprise that 64 per cent* of people who do not own their own home, but would like to, report that the biggest barrier they face is the need to raise a large enough deposit. The Building Societies Association, launching a new housing initiative today called The Housing Hub, believes that there is an opportunity for lenders and housing associations to co-operate more closely to bring alternative home ownership models into the mainstream to help consumers jump this hurdle.
In the past, there has been the perception that shared ownership and equity loan models have operated at the margins of home ownership. However, in recent years the schemes have become more main-stream, offering an alternative to more aspirant homeowners. The Government's affordable housing agenda has already included schemes such as the FirstBuy equity loan programme in England. These alternative forms of tenure are progressively being made available to a much wider audience across England, Wales and Scotland.
To support the development of these housing options, the BSA, with funding from Nationwide, has developed a B2B website called The Housing Hub. The purpose of the Hub is to promote dialogue and the exchange of information between housing associations and lenders willing to lend on such properties. It is anticipated that in making the 'marriage' of property and mortgage finance simpler and more open, these forms of tenure will increasingly offer another option to those who want to own their own home.
Today the Hub is launched. It is already populated with information from eight housing associations and eight lenders, with more to follow shortly. Over time there is potential to extend access to the Hub to other interested parties and include additional information for conveyancers and brokers. Consumers can already use the Hub to find housing association developments in their local area and lenders willing to lend on such properties.
Paul Broadhead, Head of Mortgage Policy at the BSA, said: "Increasingly, forms of shared ownership offer a viable alternative for young professionals, who may have household income of up to £60,000 but are struggling to raise the deposit needed to get a foot on the housing ladder. The Housing Hub is one of a number of BSA initiatives looking to establish a more creative approach to help house the nation. Mutual lenders are generally far more open and less likely to apply a 'computer says no' approach to mortgage lending."
Andrew Baddeley-Chappell, Head of Mortgage Strategy & Policy at Nationwide Building Society, said: "Nationwide is proud to have funded and to have helped drive this initiative aimed at helping improve how lenders and providers work together. This is simply the right thing to do and is one more way in which Nationwide helps support families in the UK to enjoy a home of their own."
Commenting on the launch, Clive Betts MP, CLG Select Committee chair and co-chair of the All Party Parliamentary Group for Housing and Planning, said: "I am pleased to be hosting The Housing Hub launch event in the House of Commons. The Housing Hub will be an excellent resource that will allow lenders and housing associations to come together and share information."
Press Office Contacts:
Hilary McVitty, Head of External Affairs, BSA
Tel: 020 7520 5926 / 07507 837 326
Deborah Isaac-Taylor, Nationwide Press Office
Tel: 01793 655354
Notes to Editors:
* 64 per cent of those surveyed in the BSA's PropertyTracker cited raising a deposit as the biggest barrier to home ownership. The survey is carried out by YouGov. Total sample size March 2012 was 2,044 adults. Fieldwork was undertaken between 2 & 5 March 2012. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+).
1. Shared Ownership - the homebuyer buys a share of a property with the remainder being owned by a Housing Association. The homebuyer pays rent to the association for the portion they do not own.
2. Shared Equity - the homebuyer owns 100% of the equity of their property. The Housing Association provides an additional loan to make up the mortgage shortfall.
3. The Housing Hub provides housing associations with access to the lender's criteria for shared ownership and equity loan schemes and the housing associations publish details of their current and future housing developments in England, Wales and Scotland.
4. The lenders currently on The Housing Hub are: Dudley, Hanley Economic, Ipswich, Leeds, Mansfield, Nationwide, Newbury and Teachers Building Societies.
5. The housing associations currently on The Housing Hub are: Bromford Homes, Keyhomes East, Moat Homes, Plumlife, Radian Group, Sovereign Living Limited Thames Valley Housing and WM Housing Group.
6. Lenders and housing associations can register to become part of The Housing Hub by contacting the BSA via firstname.lastname@example.org.
7. Screen shots of the site as a Jpeg are available from the BSA Press Office.
8. Housing Association qualifying criteria for a shared ownership/shared equity property include:
Household income must be under £60,000.
The potential homeowner must not have an adverse credit history and must be able to afford the costs involved (mortgage + top-up loan or mortgage + rent).
The potential homeowner must not be in mortgage or rent arrears or in breach of a tenancy agreement at the time of application.
The potential homeowner cannot afford to buy a property that meets their current housing needs without this assistance
The Building Societies Association (BSA) represents mutual lenders and deposit takers in the UK including all 47 UK building societies. Mutual lenders and deposit takers serve around 32 million customers, have total assets of over £375 billion and, together with their subsidiaries, hold residential mortgages of nearly £240 billion, 19% of the total outstanding in the UK. They hold more than £250 billion of retail deposits, accounting for 22% of all such deposits in the UK. Mutual deposit takers account for 34% of cash ISA balances. They employ approximately 50,000 full and part-time staff and operate through approximately 2,000 branches.
Policy and External Affairs Officer
Building Societies Association
6th Floor, York House