Shared Home Ownership for People with Disabilities
Housing Associations can now access funding for people with long term disabilities to enable them to become home owners. This is achieved through a Shared Ownership scheme whereby the Applicant purchases part of the property and the Housing Association owns the other part.
Newlon has received a Housing Corporation grant to help with the cost. It is for property purchases in the east sub-region: Hackney, Newham, Tower Hamlets, Waltham Forest, Redbridge, Havering, Barking and Dagenham, City of London.
The scheme works as follows. Through an estate agent the service user identifies a property they wish to purchase. The RSL purchases the property and on the same day sells a share (between 30-75%) of the property to the Service User.
For people with disabilities or support needs, Income Support Mortgage Interest(ISMI) benefit can help meet some of the mortgage costs. This benefit will only ever help with the interest payable on a mortgage. The maximum amount of mortgage on which ISMI benefit can be paid is £100,000. ISMI benefit will pay the mortgage interest provided the person:
The part of the property owned by the Housing Association is rented to the SU. The rent and service charge is eligible for housing benefit.
This means someone with a disability can own their own home whilst paying no mortgage or rent (subject to eligibility).
This is an interest only mortgage which means that the capital is only paid when the property is sold. If the value of the property falls the deficit would have to be met by the Housing Association. However if the property price increases the Service User will benefit in proportion to their share.
The housing association will include responsibility for all repairs and maintenance of the property via the rent.
The service user has to have a support package which is agreed by Care Management or Supporting People before they move in. This best lends to Direct Payment schemes.
The key advantage of this scheme is that it allows people with disabilities to choose where they want to live and the type of property they wish to live in. There is the additional benefit of greater security of tenure as the Service User is a leaseholder, not a tenant.
For more information contact:
Sonia Lyng
Shared Ownership Project Manager
07850 517505
