Buy a Home

Shared ownership means that you will own a percentage of the property while a landlord will own the remaining part. This means that you will rent the part owned by the landlord.

Shared equity or equity share means that we will provide you with a loan for a percentage of the property. You will own 100% of your home and you will only need to repay the loan when you sell the property.

The homes tend to be available via 3 ways…

• Homebuy tends to be available on new housing developments, either built by MHA or on developments built by developers such as Barratts and Taylor Wimpey, who then work with MHA to deliver the ‘affordable housing’ element of their site.
• From time-to-time Homebuy owners decide to sell their property and move on, and we then have the first refusal to offer the property to somebody on the Homesearch waiting list.
• It is also available should a tenant wish to buy their MHA rented home, although there is certain criteria which needs to be met to enable this to happen. If you are interested in finding out more, please contact the Homesearch team.

You must be 18 or over and a British or EU citizen or have indefinite leave to remain in the UK. We always use the most current Welsh Government’s rules when considering all applications.

As a guide, you will need to meet at least the following requirements:

• Your household should not be able to afford to buy a home on the open market, without the equity loan.
• You will need to provide proof of your household’s income and savings and have a mortgage in principle.
• As a general guide, for a single applicant, MHA would review your monthly earnings/ outgoings. Convert the figure to an annual amount and then multiply by 3.8.
• We would do the same for joint applicants but multiply the annual amount by 3.5 instead of 3.8. The final amount should then be above the 50%, 60% or 70% of the purchase price (which factors in the equity loan amount), but below the full purchase price of the property.
• Obtain a mortgage (with a qualifying lender) to cover your contribution. You must also have sufficient savings to cover other costs associated with buying a home.
• You must not be receiving housing benefit or the housing element of universal credit, nor have received these 12 months prior to applying for Homebuy.
• You are not eligible for Homebuy if you already have a financial interest in another property (e.g. due to a relationship breakdown). If there is, you must sell this interest before applying to buy a home through Homebuy. We would include money from a house sale in your financial assessment for Homebuy.
• The home you want to purchase should be suitable in size and usually no more than one bedroom larger than your household requires.
• The home you buy must be your sole place of residence.
• If you are a social housing tenant, you must not be in rent arrears or in breach of your tenancy agreement in any other way.

As long as your debts are not more than 15% of your income after deductions we can accept you. We will also consider your debt circumstances on an individual basis if you can demonstrate that you can budget to manage your repayments.

Remember that certain properties may also carry a maintenance charge to cover communal garden maintenance or cleaning and you will need to include these costs in your budgets.

This is determined by the type of property and the need within the area. This is set by Monmouthshire County Council and we will advertise what equity share is available on each property listing.

A Homebuy applicant with a local connection to Monmouthshire would be given preference over an applicant with no local connection – see Monmouthshire Homesearch’s Allocations Policy for a definition of local connection, available at www.monmouthshirehomesearch.co.uk and also the Rural Allocations Policy contained within the Appendices of the Allocations Policy.

Other shortlisting criteria may also be applied.

You can buy your home jointly with someone else.

The financial assessment will consider the savings and income of all of those buying. However, a joint application will not qualify to buy unless all parties are to jointly own the home.

A Deed of Trust providing rights of occupation for a qualifying applicant is unacceptable as an alternative to becoming a joint legal owner. Your legal representative should be able to advise you further, so you understand the different forms of co-ownership. No more than four people can jointly buy a home through Homebuy in Wales.

Yes you will still be eligible. This is providing the amount you receive, doesn’t then enable you to purchase a home at full market value.

Yes, if you are in the process of selling your existing home. Remember you will need to include the proceeds of the sale in your income.

Buying a home isn’t cheap, there are a lot of costs that you will need to take into account, these include:

• You would need to provide a reservation fee to secure the home you wish to buy (which is non-refundable but is taken off the purchase price when you buy the property).
• You will be responsible for purchasing costs e.g. legal and land registry fees or possibly land transaction tax.
• You will be responsible for the cost of getting a Homebuy mortgage and mortgage repayments.
• You will need to pay council tax, water rates and other utility bills.
• You will probably have to pay some service connection fees.
• You may need to pay removal costs.
• You will be responsible for all repairs and maintenance and maintain your home to a good standard.
• You must notify MHA and obtain our written approval to make any alterations or improvements to the property.
• You will be responsible for buildings and contents insurance. If you purchased a shared equity flat where we own the freehold, MHA will insure the building (not the contents of the flat) and apportion the cost between flats in the block.
• Depending on the property you are purchasing, you may be responsible for paying service charges. There will be valuation costs and legal costs to consider should you wish to re-mortgage, change the equity loan amount or sell the property.
• The mortgage must be obtained from an approved building society, bank, a friendly society or an insurance company.

MHA’s consent is required to change your mortgage, such as a change of lender or agree an increase in borrowing.

To consider your application for consent, MHA would require a valuation of the property from a person qualified with the Royal Institution of Chartered Surveyors. MHA and your lender would also need to enter into a ‘Deed of Priority’ which will make clear the respective priorities of your first lender and MHA.

If you wanted to repay part or all of the equity loan, you will need to inform us. You will need to obtain an independent valuation from a qualified person. MHA will then inform you in writing of the amount you need to repay.

If someone who buys through Homebuy dies and the property passes to a partner or member of the family, that person may take over the ownership of the property and continue to live there.

The costs of running the home and keeping up the mortgage repayments will normally transfer to the partner or family member continuing to live in the home.

If there is no partner or family member who meets the above criteria, generally the property will be sold and the equity amount repaid to MHA.

You will firstly need to inform MHA and obtain an independent valuation from a RICS qualified valuer, so the value of the property can be agreed (you are responsible for paying the valuation fee).

The valuation will not include alterations or improvements you have made to your home which MHA gave you written consent to carry out. If you did not seek our written approval you will not fully benefit from any increase in the value of your property as a result of the alterations – MHA would be entitled to a share of the increase in property value, as a result of unauthorised alterations or improvements.

MHA has the right of ‘first refusal’ and would have a set timeframe to find a buyer or potentially purchase the property ourselves. If after that period of time a sale is not agreed, you would be able to sell the property on the open market. It would ideally have to be sold under the same criteria as you bought (the shared equity loan would be recycled into the new purchase).

The new buyer(s) would complete a Homebuy application and eligibility assessed  for the Homebuy scheme. This might mean it will take a little longer to sell the property.

If these scenarios are not viable you would be able to sell the property on the open market and then repay the equity percentage back to MHA.

Yes. The Welsh Government can also offer a low cost loan on new build properties. Help To Buy gives people the chance to buy a new home with only 5% deposit. This scheme applies to most new build properties and most developers will offer it on their home, including our subsidiary, Capsel.

Remember that the scheme offers a repayment loan. This loan will attract interest and after five years you will be expected to repay the interest. If your circumstances change and you’re able to pay more, you can pay extra off the entire loan and own more of your property (known as staircasing). You can find out how the scheme works and check your eligibility here: https://gov.wales/help-buy-wales

If you’re seeking to purchase a new build property that is advertised as available to purchase under Homebuy, please contact our Capsel Team on 0333 207 9000.

If you’re currently a tenant of MHA seeking to purchase the new build home you live in, please contact our New Homes Team on 01495 761014.