Help for first time property buyers in Caerphilly after £5m deal between Principality and Fairlake Living housing association
News | Richard Gurner | Published: 08:09, Thursday July 21st, 2011.
Last updated: 12:41, Thursday December 12th, 2013
A £5million deal between the Principality Building Society and housing association Fairlake Living could see more first time buyers in Caerphilly get on the property ladder.
Principality Commercial has provided £5m of funding for Welsh housing association Fairlake Living, a member of the Seren Group, to build new shared-ownership homes in Caerphilly, Newport, Torfaen, and Monmouthshire.
Shared ownership enables buyers to part-own their property at first before making a full purchase.
Darrell Bolton, Fairlake Living’s director, said: “Fairlake Living is well aware of the demand from first time buyers who are unable to meet their home ownership aspirations because of the need for a larger deposit.
“We talk to many people who have smaller deposits of between £3,000 and £10,000, but that is simply not enough in the open market.”
The latest figures from the Council of Mortgage Lenders reveals that the average deposit required by first time buyers in Wales is now 20% of the loan – an average of £17,000.
In a recent survey, Principality found that two out of every five people in Wales believe that the key to kick-starting the housing market in Wales is for more affordable housing to be made available.
The lack of available credit (15%), the looming risk of interest rate rises (11%) and a shortage of innovative products aimed at first time buyers (10%) were also blamed for the current stagnant housing market in Wales.
The first 12 shared ownership homes have been delivered at the Foxglove Meadows site in Newport via a planning agreement negotiated by Newport City Council.
Tim Beckingsale, Fairlake Living’s Head of Sales and Property Management said: “Our customers can buy a share of their new home, typically between 50% and 70% depending on affordability, while paying a low rent on the remaining share. They can then buy out the remaining share at a time that suits them.”
Peter Hughes, head of Principality Commercial, said: “Affordable, low cost home ownership solutions in Wales has long been the agenda of the Welsh Assembly Government and delivering on this agenda is at the heart of Principality.
“Pre-credit crunch house prices had soared to a level that had become completely out of step with incomes and despite falling house prices and record low interest rates in today’s post credit crunch environment, first time buyers face another hurdle in the form of large deposits.”