Buying affordable housing in Cornwall

Aerial view of houses in Marazion. There are affordable housing schemes in Cornwall for local residents and first time buyers.

Due to rising housing prices, more people could be considering buying affordable housing in Cornwall. Currently, there is a lot of unprecedented demand for property in Cornwall. During the pandemic housing prices rose and they keep rising, because of this, there are fewer and fewer private rental properties available.

What is affordable housing?

When a property is being sold for less than its market value; this is affordable housing.

Usually, these properties are offered as part of a scheme run by the Government or council and many are aimed at people with either a local connection to the area or are first time buyers. Affordable housing in Cornwall is beneficial to the local community and first time buyers.

Can I buy affordable housing?

People are qualified to buy an affordable home if the total household income is less than £80,000 a year and they cannot afford to rent or buy a fitting home on the private market.

People who have owned a home previously but cannot now afford to buy a property and first-time buyers have most schemes open to them. Specific circumstances may also make home owners eligible, such as the breakdown of a relationship and being unable to buy a property due to said breakdown.

You will also need to prove that you have a connection to the local area and have had said connection for at least the last five years. Specifications for eligibility will be in the Section 106 agreement that the property developer has enlisted.
Additionally, you will, in principle, need a mortgage. Predominantly, usurers require a deposit which is 10-15 percent of the asking price.

What schemes are available to me in Cornwall?

It is important to get financial advice before applying for access to these available schemes. A favoured option at the moment is purchasing a property through a shared ownership scheme, this means that you buy a share of the property, commonly between 25-75 percent, the rest would be paid for with rent. You can increase the share you buy over time until you eventually own 100 percent of your home and the entire freehold will be relocated to you; this is called staircasing.

There are a few specifications to buy via shared ownership:
• You’re a first time buyer.
• Your household income cannot exceed £80,000 per annum.
• You need to be able to demonstrate that you are not able to purchase a property that meets your needs.
• You are currently a homeowner but cannot afford to buy to meet your needs.
• You have owned a property in the past but cannot currently afford to buy one.
• You already are participating in shared ownership and you wish to move.

The property may be in a designated protected area (DPA), additional requirements may be needed. DPAs are areas, predominantly rural areas, where social housing needs to be maintained, these are designated by the Secretary of State. Housing Associations in these areas will either make sure any lease will hold an obligation by the shared owner to sell the property of said lease back to the Housing Association or they will restrict staircasing to 80 percent. Housing Associations are not permitted to decline taking back the property; this is a Mandatory Buy Back Clause.
These measures are in place to protect the future of the property and make sure that it will be permanently reserved as an affordable property.

What is a Buy Equity Loan scheme?

The Help to Buy Equity Loan scheme has recently changed, due to this a new scheme has been launched in April, which will go on until 2023. This scheme can be a good way to take the first steps to get onto the property market, certain criteria need to be met, such as capping the value of properties you are eligible to purchase via said scheme. Due to this, in Cornwall you will not be able to buy a home priced £349,000 and above.

What is Section 106 Discounted Market Sale?

To meet planning criteria in Cornwall, many developers need to be able to provide a specific number of affordable homes. These homes will then be sold at a discount through the Section 106 Discounted Market Sale scheme.

The goal of the scheme is to provide local people with affordable housing, you need to meet a few necessities such as, demonstrating that you have lived here or have worked here for a necessary amount of years, or have family in the local area who are in need of your support.

We know how important affordable housing is here in Cornwall and we are here to help. We have trained specialists who will be able to assist you and answer any questions you may have concerning property law and Affordable Housing schemes. We are up to date and comfortably knowledgeable on all matters relating to property law and residential conveyancing.

For further advice, information and help please contact us.

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