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Interest In Part Buy-Part Rent Is Booming

Posted 22 April 2020 by Keith Osborne

Mel Toomey, director of sales for heylo, on house-hunters’ interest in purchasing a share of a brand new home is increasing...

We’ve spoken to Mel Toomey, director of sales for heylo, about how house-hunters’ interest in purchasing a share of a brand new home is increasing dramatically in these tough times.

How have things been in your Home Reach part buy-part rent property market since lockdown?

We’ve been absolutely swamped with leads, with people wanting to know more about how the scheme works, where they can find it and the process. The majority of people we are talking to are people who need to move, or were already planning to find a new home before the current crisis, and they all still want to carry on their search.

How have you been helping buyers?

We’ve been offering an ‘Early Bird’ reservation. While there are a number of terms and conditions that potential purchasers need to meet to qualify for part buy-part rent [sometimes referred to as Shared Ownership], which our housebuilder partners will go through with them, in the meantime we are holding the properties they want to buy until they get a chance to go through that process. This has been a great relief to many.

What advice have you been giving to people who want to take the purchase process further?

With many lenders dramatically reducing mortgage options currently available, we’re advising people to hold off on the finance side of things until things settle down and the market grows again. Already, there are lenders changing the way they evaluate what they are prepared to off. For example, where they might have taken 30% to 50% of regular overtime in their calculation, in these days of furlough and uncertainty in the workplace, that’s no longer happening.

We also let people know that in order to take part in the scheme, they will need to register with their regional Help to Buy agent, to go through some of the terms and condition of qualifying for the scheme.

One thing we have found is that all these changes have increased house-hunters’ interest in part-by-part rent. They might have been relying on Help to Buy, which requires a 5% deposit and a 75% mortgage, all based on the full price. With our scheme, they require a deposit and mortgage only based on the percentage they are purchasing. This means that our scheme is available to people on a far more modest income.



Aside from its benefits on saving and borrowing the money they need to buy, what else attracts people to your scheme?

Fundamentally, paying a combination of mortgage and rent is significantly cheaper than just renting, which is getting more and more expensive. It also means they can consider looking at a larger home than they expected. I use a BMW car analogy – they might afford 100% of a 2-series, under the scheme they could weigh up purchasing 50% of a 3-series convertible instead. So they might be able to buy two-bedroom apartment outright, or prefer a share in a three-bedroom house, where can they have more space, a spare bedroom/home office and a private garden. This piques people’s interest significantly.

There’s also the security of homeownership, rather than being purely a tenant, and as property values increase over the years, their percentage grows at the same rate, which is a good return on their investment.

Are there any big differences between part buy-part rent and the Shared Ownership offered by housing associations?

Where many Shared Ownership properties are often separate from those offered through private sale on a development, our part buy-part rent homes are dotted around a site and indistinguishable from those around them. In terms of physical differences, there are none – they come with the same specification and guarantees as private-sale homes.

What part does heylo play in it all?

We act as the landlord, though with a hands-off attitude, so we’re not over-controlling people. Buyers are looked after by the housebuilder – they’re the ones who take them around show homes and do the full ‘welcome’ when people move in, for example demonstrating how every part of their brand new home works.

We collect the rent and look after ‘staircasing’, which is the way that people can buy a greater proportion of their property, up to 100%. We explain this option in full to buyers but don’t actively encourage it, it really is up to them. It’s a great option to have but we find that only a small percentage of residents take it up. If and when someone wants to sell their home, they come to us to start the process.

Do parents often play a big part in purchasing a home for their sons and daughters?

Yes, the Bank of Mum and Dad is very commonplace, a large percentage of buyers seem to be around 28- to 35-years-old. In fact, part buy-part rent is actually very helpful for parents because if they want to help two or more sons and daughters buy a home, this scheme means they need to commit less money to each and can spread their funds around more.

Do you foresee any changes to buyer assistance schemes as a consequence of the current economy and property market?

It’s important that government continues the likes of both Help to Buy and Shared Ownership as ways to cope with the requirements of deposits and mortgages. One thing I would say about any changes is that it is very clear we have to broaden our definition of ‘key worker’. There’s no priority for these people in government schemes and the group should include not just the NHS but also a host of others who have been vital to us over the past few weeks, such as delivery and public transport drivers, who may not have been considered key previously.


Take a look at some of the new homes currently available with the part buy-part rent scheme from Home Reach.

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A Guide To Part Buy Part Rent
Part Rent Part Buy is a scheme you can use with Home Reach where you buy a share of your chosen newly built home and pay a monthly rent on the part you don’t buy. Find your part buy part rent house today!

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