Housing Corporation News Release

Corporation opens HomeBuy Direct bidding

Wednesday 1 October      ref: 72/08

HomeBuy Direct, a £300 million initiative aimed at helping up to 10,000 first time buyers currently frozen out of the mortgage market meet their housing aspirations and supporting the house-building industry, was launched today by the Housing Corporation.
 
HomeBuy Direct is part of a package of measures announced by the Government early in September. Today the Housing Corporation opens the competition to select suitable schemes and properties from house-builders.

HomeBuy Direct aims to:

• make selected new build homes available to eligible purchasers who are unable to afford a home without assistance;

• provide a targeted boost to the housing market by stimulating more transactions; and

• help maintain the capacity of the house building industry to respond when market conditions improve.

Providers are now being invited to bring forward suitable schemes and properties to participate in the delivery of the new product. Both the scheme developer and the Housing Corporation will make an equal contribution by way of an equity loan to assist a purchaser into home ownership.

Housing Corporation Chief Executive Steve Douglas said, “HomeBuy Direct builds upon the success of English Partnerships’ First-Time-Buyers’ Initiative (FTBI), which is now concluding its investment phase.

“With HomeBuy Direct we want to expand on that and help up to 10,000 new households meet their housing aspirations. We want to help first-time-buyers to purchase, to maintain the capacity of the house building industry; and finally, help provide a targeted boost to the housing market. This will, in turn, help contribute to our long-term housing supply targets and to make housing more affordable in the longer term.”

Project Director for FTBI at English Partnerships Kirk Howe said, “The First Time Buyers’ Initiative has been extremely popular with buyers and house builders alike, and will deliver around 3,500 extra affordable homes by the end of the programme.  I am pleased that HomeBuy Direct will build on this success, offering assistance to many more first time buyers who have been priced out of the property market.”

HomeBuy Direct will be managed by the Housing Corporation and its successor, the Homes and Communities Agency, when it is vested from 1 December 2008.

Ends.

For further press information please contact Terry Sefton on 0207 393 2118.

Notes to editors

1) The Housing Corporation is responsible for regulating housing associations, which provide some two million homes across England.

2) The Housing Corporation is the Government's national affordable homes agency, responsible for investing in new affordable homes and regulating nearly 2,000 housing associations across England. The Corporation's £8.4 billion investment programme for 2008-11 is its biggest ever. Its previous investment programme of £3.9 billion for 2006-08 funded 92,752 homes - 52,929 of these for affordable rent and 39,823 for affordable sale through the Government's HomeBuy initiatives, helping people to get a foot on the property ladder.

3) The Housing Corporation is working with English Partnerships and Communities and Local Government to establish two new bodies, the  Homes and Communities Agency (HCA) and Tenant Services Authority (TSA) which are due to launch this December.

4) The First Time Buyers’ Initiative (FTBI) is part of the Government’s wider HomeBuy scheme and is designed to help first time buyers who have been priced out of the housing market to get a foot on the property ladder.  Under the Initiative, buyers must be able to afford a mortgage for a minimum of 50% of the sales price, with the remainder contributed by English Partnerships via a direct payment to the developer.  For the first three years, buyers only have to cover their mortgage repayments, after which they begin to pay a charge to English Partnerships based on the initial contribution the Agency made.  Unlike traditional shared ownership, the buyer has 100% title to the property.  As at the end of July 2008, FTBI is available on over 80 new housing developments nationwide and will have provided around 3,500 homes by the end of the programme.

FTBI has now evolved to form the basis of HomeBuy Direct, aligning it with the Housing Corporation’s National Affordable Housing Programme, in preparation for the move to the new Homes and Communities Agency.