So what is affordable housing and who is eligible? You may have more options out there than you think!
This blog takes you through everything you need to know about affordable housing options and where to find them…
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Table of Contents
What Is Affordable Housing?
Affordable housing is available to those unable to rent or buy some homes supplied by the private sector. The word itself “affordable” may be seen as relative, given affordability can vary between individual households and be area specific.
Generally, affordable housing is for those with a household income at or below the median as rated by a recognised housing affordability index.
The UK government standard definition is any property provided at least 20% below market value and relevant for both rentals and properties for sale.
If you are interested in affordable housing. We advertise social rent, affordable rent and some market rent properties that are affordable. This is based on the fact that the rentals for these properties is at or below the average rent figure in the UK. You can also set up property alerts and have access to an online moving house checklist.
Affordable housing data
17% of British households live in social housing. 19 percent of British households live in private rentals. So nearly 40 percent of British households live in some form of rented property.
Affordable housing definitions are not that clear-cut
For example, there are properties in the private sector that could be deemed affordable. So their rent may be at market rent levels, however they fall under the national average.
Likewise, you can still buy an affordable home from a homeowner or house builder. Typically these are aimed at first time buyers.
To complicate it further, each region of the UK has a different level of income and thus the affordability of homes in that area will differ from other regions.
Affordable housing encompasses all tenures including renting, shared ownership & full ownership, with renting options expanded even further.
Social Rent
With rent to be paid to local authorities and registered housing associations. Search for social rent properties.
Affordable or Intermediate Rent
Also known as affordable rent is set at 80% of market rent values. Search for affordable or intermediate rent properties.
Market Rent
Rental values are determined by a private landlord. It may be worth noting when choosing to rent privately, tenants may apply to a tenancy tribunal requesting a rent reduction if they deem the rent to be unreasonable.
According to UK Government data affordable rental homes were the most common type of affordable housing for 2019-20, providing 47% of the total. Most of this affordable housing sits within the ‘social housing’ sector.
However, it is apparent homeownership is becoming increasingly more difficult. House prices continue to increase at a greater rate than the rise in wages. There is mounting pressure on the social rental sector and prompting the growth of affordability within the private sector.
What are the requirements for social or affordable rent?
It is becoming more commonplace for local councils to request proof a person has had a local connection for 5 years or more before placing them on a waiting list.
Is renting your only option?
Absolutely not!
It is harder to get a mortgage with a lower income, but not impossible.
Different mortgage lenders have their own eligibility criteria depending on mortgage type and the amount you want to borrow. However, there are many affordability schemes to help buyers (first-time buyers or otherwise).
Considering an affordable housing option could help a first-time buyer get onto the property ladder. Especially considering the introduction of 95% mortgages and the need for a smaller deposit.
Affordable homeowner schemes…
Shared ownership: Arguably one of the most affordable ways to buy a property, you effectively buy a part and rent the other. By purchasing a share between 25 and 75% of the property value, this option is ideal for those unable to afford the mortgage for the entire property.
If this is something you are considering why not take a look at our shared ownership mortgage calculator to see what you can afford.
Search for shared ownership houses.
First homes scheme: First time buyers receive a 30% discount on the market value of a new build property.
With many schemes to ensure good quality affordable housing is widely available, we truly believe Everyone Deserves A Home.
To find your forever home, or a home for now start your affordable property search.
Find affordable housing, get money saving alerts and access to your own online moving house checklist.
