24 June 2005
Social landlords have criticised the government's flagship scheme to extend home ownership to lower-income households as 'unworkable'.
The National Housing Federation says the Homebuy proposals, launched for consultation in April by the Office of the Deputy Prime Minister, are not affordable for many intended beneficiaries and not viable for housing associations.
Under the plans, existing association tenants and others on low incomes would be able to buy a stake in a property provided by a social landlord.
But the NHF's response to the consultation, published on the June 24 closing date, warns that the proposed 50% minimum stake will be too expensive for households living on incomes of £25,000 or less in areas with high property values.
The federation is also warning against proposals for housing associations to charge rent on part, but not all, of the unsold portion of the property. It says this will mean Homebuy schemes are not financially viable for many associations.
NHF director of policy Danny Friedman backed the scheme in principle but said: 'These plans are… a real missed opportunity. The figures don't stack up for residents, housing associations, lenders, and, ultimately, the public purse.
'Plans to promote a new asset-owning section of lower-income households will fail unless the scheme is made more accessible.'
PFjun2005
