Affordable housing is meant for residents on low and medium incomes, and is defined as social housing and ‘intermediate’ housing.
Low-cost rented homes to help low-income households who are unable to secure or sustain housing on the open market. Rents are set in line with the government’s rent policy for social rent or affordable rent, or at least 20% below local market rents, including service charges where applicable. Tenants living in this type of housing will have an assured tenancy. Housing Benefit can still be claimed to help with paying the rent.
Homes let at ‘social rent’ or the Mayor of London’s ‘London Affordable Rent’ are usually affordable to those on low incomes.
Homes let at ‘affordable rent’ are set at or near 80% of local market rents, including service charges.
Consists of homes for sale and rental accommodation provided at a cost above social rent but below market levels (ranging from equity products to rented homes), for residents who are not in sufficient priority need to be eligible for social housing.
What is shared ownership
Shared ownership has enabled many people on medium incomes to take a first step on the housing ladder who cannot buy a home outright. The share of the home purchased can be as little as 25%, with a rent (usually 2.75%) paid on the remaining share.
Purchasers then have the chance to ‘staircase’ out their equity share of the property, gradually increasing the portion of the home that they own, and therefore paying less rent on the remaining portion, until they own 100% of their home.
London Living Rent
London Living Rent is meant to be an affordable ‘rent to save’ tenure for households with a gross annual income of £60,000 per annum. The homes will be offered on tenancies of a minimum of 3 years and up to 10 years at intermediate rent levels. It is a type of intermediate rent based on one third of ward median income paying rent on a 2-bedroom property to support Londoners to save and move into homeownership.
Discount Market Rent
Discount Market Rent is an intermediate rent for household incomes of less than £90,000. The required discount is agreed with the planning authority and could be a ‘blended’ range based on market rent up to 80%, and usually offered in build to rent developments.