Affordable Housing – A Northern Ireland First - 2 September 2008
An affordable housing project that is the first of its kind in the UK was launched in Portadown today by Minister for Social Development Margaret Ritchie.
The people to benefit will be first-time buyers and the Minister says she wants to see similar housing partnerships in other parts of Northern Ireland. More affordable housing is a key plank in her New Housing Agenda.
The unique pilot scheme, Own A Home, is a joint initiative between Government, Turkingtons, the Portadown-based builder/developer, two housing associations, Clanmil Housing and the South Ulster Housing Association, and Barclays Bank.
Under the scheme, buyers will not have to pay a deposit on the houses which cost from £145,000 and are at Maghon Park, Portadown. They will purchase 50% of the value of the house through a 100% mortgage from Barclays. Turkingtons will pay 25% of the cost of the house, with the remaining 25% provided by either of the housing associations.
Margaret Ritchie says: “I very much welcome this innovative scheme, which sees a housing partnership between Government, developers, housing associations and a lending institution. It is good news for first-time buyers in Portadown, giving them a real opportunity to get on the housing ladder at this very difficult time.
“As part of the New Housing Agenda, I want to increase the supply of affordable housing. This scheme, a first in GB and Ireland, does that, but it is just a start. I want to see many more of these housing partnerships emerge in Northern Ireland so that more and more people can get on the property ladder. My officials are currently working on a range of innovative initiatives that will help more people onto the housing ladder.
“I would like to commend Clanmil and the South Ulster housing associations for joining in a truly unique partnership with Turkingtons and Barclays.
“Their partnership has made affordable housing a reality, particularly for those first-time buyers who have found it almost impossible to buy a house over the last few months."
Jim McKeag, managing director of Turkingtons, says: “We are delighted to be able to help people take that first step on the property ladder. The houses are competitively priced and have a garage, gardens and a brick-paved driveway.
“Clendinning is just minutes from the centre of Portadown and this established development of 127 homes is convenient to schools, shops and leisure facilities, so all round it is a fantastic opportunity for the first-time buyer.”
Adrian Doran, head of Barclays Commercial Bank, says: “Barclays is delighted to help fund this innovative pilot scheme. We are already established bankers to Clanmil, South Ulster, and many other leading Housing Associations in Northern Ireland, and we recognise the challenges that people have in trying to get on the housing ladder in the current difficult market. The Portadown scheme is innovative in that the Housing Associations and individual's shares are both funded by Barclays. This forward thinking has enabled a one stop shop funding solution, making housing more affordable to all."
Mark Turner, assistant director of South Ulster Housing Association says it is pleased to be “a leading player in this new strategy to provide affordable housing”.
Clare McCarty, chief executive of Clanmil, says: “The Own A Home shared equity scheme fits perfectly with our commitment to seek out innovative solutions to help people access affordable housing. The unprecedented inflation of property prices in Northern Ireland tipped the balance of affordability, making it extremely difficult for local people to buy their own homes, even as house prices fall. Because Barclays can offer a 100% mortgage on this pilot scheme, people on moderate wages can now access the benefits of home ownership. Equity sharing enables people to take advantage of a life-changing opportunity and will enable those who aspire to home ownership to realise their dream.”
NOTES TO EDITORS
- In February 2008, Margaret Ritchie, the Minister for Social Development, launched the New Housing Agenda, the most radical housing initiative in a generation. In it she pledged to do everything in her power to increase social and affordable housing. This housing partnership initiative reflects innovative thinking on her part, where, for the first time in GB and Ireland, Government, developers, housing associations and lending institutions are brought together to give people a much better chance of getting on the housing ladder. The Minister sees this scheme as a start and she will be actively encouraging many more housing partnerships of this nature in the future.
- The development, Clendinning, Maghon Park in Portadown consists of 127 dwellings – 24 detached houses and 103 semi-detached, with prices from £145,000.
- The Own A Home shared equity scheme works in the following way:
-The purchaser buys a 50% stake in the property with the benefit of a mortgage charged on it, provided by a commercial lender, in this case Barclays.
-The developer, Turkington retains 25% for a period of up to ten years subject to it being the first party to be “staircased out” (when /if the purchaser buys further shares in the property).
-Clanmil Housing Association/South Ulster Housing Association buys the balancing 25% stake and rents it out to the purchaser (subject again to the purchaser’s right to staircase out).
-If “staircasing” is not effected within that period, Clanmil Housing Association/South Ulster Housing Association buys Turkingtons out at the then market value. Where values have declined below historic cost, Turkingtons may elect to retain the property, but subject to creating an additional “rent” as its return for the continued occupation of its share by the purchaser.
-The purchaser can, at a future date buy a further share in the property from Turkingtons/Clanmil/South Ulster and become owners outright. Alternatively if they wish to move, they are able to sell their share on the open market.
- For further information please contact: Philip Maguire, Principal Information Officer, DSD - Tel 02890 829496 / 07788 108657
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