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What are the government’s affordable housing schemes?

The government has several housing schemes to make buying a property easier for people wanting to own a home.

These include:

Help to Buy equity Loan

Please note HSBC does not participate in this scheme.

A home bought under this scheme must:

  • be a new-build property from a participating developer

  • be the only property you own

  • be lived in by the owner; it can't be let

  • cost less than £600,000 in England (or £300,000 in Wales)

The government will lend you up to 20% of the equity of a new-build home (up to 40% in London). You will need a 5% deposit and a mortgage of up to 75% to make up the rest (up to 55% in London).  

There's an interest-free period for the first 5 years. After this, you’ll need to pay interest on the loan and, if you sell the property, you’ll need to repay any outstanding amount.

The amount you pay back is worked out as a percentage of the market value. If the market value of your home goes up, so does the amount you owe on your equity loan. Likewise, if the value of your home falls, the amount you owe on your equity loan falls too.

Help to Buy equity rules are different in Wales, Scotland and Northern Ireland.

Shared ownership

If you can’t get a mortgage to buy a property outright, a shared ownership scheme could enable you to buy a proportion of your home through a housing association. You then pay rent on the rest.

For example, if you bought a 50% share of a property valued at £100,000, then you would pay rent on the remaining £50,000.

Shared ownership gives you the flexibility to increase the share of the property that you own. Most providers will allow you to buy 100% of the property over time, however, there are some that do not allow this.    

Right to Buy

The Right to Buy scheme makes it possible for existing council and housing association tenants to apply for ownership of the properties they rent.

Under the scheme, you can also make joint applications for the Right to Buy with other people who have been living in the property for at least a year. 

Forces Help to Buy scheme

Similar to the Help to Buy equity Loan scheme, but available exclusively to regular members of the armed forces. 

Under this scheme, you can borrow up to 50% of your salary interest-free (limited at £25,000) to raise a deposit. 

For more information on affordable housing schemes and to see if you’re eligible, visit GOV.UK