Landspeed Affordable Homes is a developer with a difference. Some 90% of its homes are deemed 'affordable'. That is, they are built to be affordable, and - rather than selling them via a housing association - are sold directly to the buyer on a shared-ownership basis.
Residents don't pay rent on the remaining share, thus keeping payments down, and they don't have to be a key worker to qualify .
So far, Landspeed has two such developments - one near Hastings, the other near Norwich - with another planned for Norwich next year.
Ted Reddick, the company's co-director, explains: "Landspeed doesn't make a big profit - we can't inflate our prices and don't want to. People's ability to afford homes is not increasing."
He continues: "Purchase prices are worked out based on local market values and incomes. They will never be more than 75% of local market price, and can be as little as 40%."
Residents at Little Plumstead can buy a share of the overall value, as in other shared-ownership schemes, but they don't pay rent on the share they don't own, thus keeping repayments down. However, since the property is leasehold, residents must pay a ground rent of around £260 per year.
Residents do, of course, have the option of 'staircasing' - building up their share until they own the property outright.
Case study
First-time buyers Gary and Jessica Cutting bought a 75% share of a house at Little Plumstead. Gary, 26, is a surveyor for a local construction firm, and Jessica, 22, works in a pet store. Gary talks to What House? about their purchase.
Describe your home at Little Plumstead. What are the local amenities like?
Our home is a three-bedroom, semi-detached house, situated in a quiet, residential area on the outskirts of Norwich. The house has well-sized rooms and a garden, with a carport for off-road parking. There is a local shop and post office, a school, a village hall, playing fields, a public house/restaurant and a hairdresser all within walking distance. Access to the main roads and nearby villages is also good, with regular bus services available.
How did you hear about Little Plumstead?
We saw an advertisement in a local magazine. We knew the area quite well and we then contacted Landspeed for further information and an application pack.
Were you aware of affordable housing and whether you were eligible?
We knew of the affordable housing scheme in general, but were not aware of this specific project, and whether or not we were eligible. The initial questionnaire from Landspeed listed various criteria, which determined eligibility for this scheme.
How was the application process?
The process was well detailed at each stage and efficiently dealt with. We were kept informed of the information we needed to provide to ensure our application could be processed, and we knew fairly quickly when we had been approved.
In your opinion, are there any downsides to affordable housing/shared ownership?
We don’t know enough about other affordable housing schemes to compare with this particular scheme. However, the shared-ownership scheme we are part of seems an excellent way for first-time buyers to get on the property ladder.
Are there any restrictions on decorating and other alterations to the property, given that you do own a share?
Any structural alterations or decorations to external faces of the building require the prior consent of the landlord (Landspeed).
Are you able to increase your share of the property, and if so, do you plan to?
There is an option to purchase the remainder of the share, under a process called ‘staircasing’, whereby we can purchase a proportion of the remaining 25%, eventually owning a 100% share in the property, which is something that we would be interested in doing.
How did you finance the property?
We had to find a lender suitable to this scheme and, using an intermediary, we found that Halifax came up with the best offer. This was based on a combination of our wages and a reasonable-sized deposit in order to be able to finance the property. The mortgage offer from Halifax also needed the approval of Landspeed to ensure it was compatible and appropriate to this scheme.
How do your mortgage repayments compare with any rent you have paid in the past?
We were living with our families prior to this purchase. However, we consider the mortgage repayments compare favourably with the amount of rent paid on similar properties.
For more information contact Landspeed Affordable Homes on 01329 284 109.
Interview by Sarah Speight
This article was published on 12 April 2007