Homebuilders Partner Up To Launch New Homeownership Initiative

Sage Homes, England’s largest provider of new build affordable homes, has partnered with one of the country’s largest housebuilders to launch Home Stepper, an alternative way to find a home.

The scheme is set to help thousands of people, who can’t afford to buy a home outright, onto the property ladder by offering homes on a part-buy, part rent basis. It differs from traditional Shared Ownership schemes as these homes are typically restricted to pre-determined locations agreed by local authorities (called Section 106 agreements) when they grant planning permissions.

Home Stepper allows housebuilders to convert a wider range of open market houses and apartments into affordable Shared Ownership if their purchasers can’t afford the asking price. This means buyers on lower incomes and with smaller deposits can afford homes previously beyond their reach. A Shared Ownership home is typically cheaper than renting privately and considerably cheaper than the cost of buying a home on the open market.

The roll-out of the new scheme will start with around 800 new, high-quality homes nationwide through a partnership between Sage Homes and Vistry Group, whose brands include Linden Homes, Bovis Homes and Countryside. Sage Homes is in discussion with other housebuilders to expand the scheme even further.

Vistry Group’s partnership with Sage Homes will make Home Stepper available nationwide on selected Linden, Countryside and Bovis homes.

Iain McPherson, chief operating officer at Sage Homes, said: “We’ve been able to deliver almost 12,000 affordable homes in just over five years by working closely with our partners, so I’m delighted to take this further by introducing Home Stepper.

“Our new Home Stepper scheme aims to make the Shared Ownership product available in more locations to more aspiring homeowners looking for attractive and high-quality homes to call their own.”

Greg Fitzgerald, Vistry Group chief executive, said: “We have a long track record of working in partnership with Sage Homes to deliver affordable homes and to realise the house buying dreams of thousands of customers, and this is the latest exciting chapter in that relationship.

“As the leading provider of multi-tenure affordable homes in the country, we are acutely aware that the ability of people to access the housing market is crucial to our economy and society, and we are proud of the part we are playing in that. We look forward to building many more homes and delivering many more dreams in partnership with Sage Homes through this Home Stepper scheme.”

The ‘Hawthorn’ house type at Priory Fields

What is Home Stepper?

Usually, local authority planning agreements decide where Shared Ownership (SO) housing is provided and how much there is per development. This limits how many SO customers can buy there, regardless of demand.

Home Stepper is different. It isn’t restricted to pre-set locations or numbers – instead, it responds to local extra demand for affordable housing.

If the buyer can’t afford a new-build house at the full market price, a developer that has signed up to Home Stepper can offer more new builds as extra SO homes. As with Sage Homes’ other SO customers, Home Stepper is open to customers whose combined household income is no greater than £80,000 outside London, or £90,000 inside London.

The Home Stepper customer would purchase between 10% and 75% of the home’s full market value, and pay rent to Sage Homes on the remaining unowned amount. At any point Sage Homes customers can choose to increase their share of their home by making staircasing payments up to 100% of its value. A Home Stepper customer buying 50% share of a £300,000 property would have to find a minimum 5% deposit which would be £7,500. Based on a typical mortgage rate of 5.50% and a term of 25 years, they would then pay £1,219 per month. This would include a mortgage cost of £875 on the 50% share they own and a rent of £344 on the rest.

In comparison, a customer buying the same £300,000 home at the full market price would pay £15,000 for a 5% deposit, then a mortgage of £1,750.15 per month.

These figures are also based on a typical mortgage rate of 5.50%. Around 800 new homes will be initially available through Home Stepper, with some homes already available and most due to be completed within the next two years.

Find out more at www.homestepper.co.uk.