An innovative new product which provides an alternative path to home ownership for those on low incomes has been launched by Social Development Minister Lord Morrow MLA.
The Department for Social Development has invested over £12.5million in the pilot ‘Rent To Own’ scheme that allows customers to rent a new home of their choice for up to three years and at the end of the rental period, they will receive a rent rebate of 25% towards a mortgage deposit to purchase the home through Co-Ownership or through a traditional mortgage.
The funding will enable OwnCo Homes, a subsidiary of the Northern Ireland Co-Ownership Housing Association, to purchase 100 affordable new homes throughout Northern Ireland.
Launching the initiative at Station Park, Maguiresbridge, to showcase the type of properties available through Rent to Own, Lord Morrow said: “It can be difficult for first time buyers to get onto the property ladder. Rent to Own provides an alternative pathway for many who have difficulty in getting the mortgage they need to take their first step towards home ownership.
“Rent to Own offers security of tenure at a fair price in a high standard of accommodation. Through Rent to Own householders have the opportunity to save for a home deposit while building up a sufficient rating to secure a mortgage, both of which have been identified as key barriers for homeownership for first time buyers.”
Lord Morrow added: “I am committed to increasing the supply of affordable housing across Northern Ireland. I am therefore pleased that my Department has been able to access new funding in the form of Financial Transactions Capital to bring this pilot initiative to fruition, to assist those who are not yet in a financial position to purchase a home, increase the availability of affordable homes and improve housing supply.”
Sid McDowell, Chair of Co-Ownership Housing which developed the product, said: “Rent to Own is the brainchild of Co-Ownership Housing, where we have a long and successful history of working within the private housing market but with a social purpose. This is a new way for us to do this and we are delighted to offer an exciting product which is very distinct from our co-ownership model. It will help renters to get to where they want to be - the home owners of the future.”
Alan Crowe, a Director of OwnCo Homes, said: “Rent to Own offers tenants a better option than simply renting with no prospect of a return. It starts with a commitment to a 3-year payment plan with a down payment of £2,500 and an inbuilt 25% rebate on rent paid. Together they build up a lump sum to be used towards purchasing the property.”
Further details about ‘Rent to Own’ can be found at www.owncohomes.uk or by calling OwnCo Homes direct on 0333 2001554. Information is also available on nidirect www.nidirect.gov.uk/rent-to-own.