Government publishes details of £400m homes scheme

Out-Law News | 01 Oct 2014 | 4:36 pm |

The government has published details of the administration of £400 million of loans to promote house building. The bidding prospectus for the Rent to Buy scheme for 2015 to 2017 has been released, setting out the detail of the funding and bidding process. 

The prospectus (17-page / 368KB PDF)  invites applicants, such as housing associations, to bid for up to £200m of recoverable loans to support the building of fixed term affordable homes between 2015 and 2017 in London. A separate fund of £200m is also available for homes outside London.  

The loan must be repaid within 16 years but bidders can repay early. Properties must be retained and let at sub-market rent for a minimum of seven years to people who have never owned a home before. If the landlord seeks to sell the property at any time after this period the tenant has a right of first refusal. The tenant can also put in a request to buy their home within this seven year period.

The prospectus invites bids for loan funding to the Homes and Communities Agency via the Investment Management system.