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The scheme will allow housing associations and other providers to bid for a share of the £400 million fund which has been made available of low-cost loans to deliver up to 10,000 new homes. These will be built between 2015 and 2018 and will mostly be small one and two bedroom apartments.
Landlords must make the homes available for rent at below-market rates for least seven years, allowing tenants time to save money to buy their rented property if they choose. At the end of this time, if they decide not to purchase the property, they can buy a different one, or rent another property either privately or with the housing association.
If the home is sold, the provider can use the proceeds to build more affordable homes in their area, said the Department for Communities and Local Government (DCLG). If it is not, the home will still be available for someone else to rent with a view to buy.
The providers - who will have up to 16 years to repay the loans - cannot sell the properties or rent them at market rates until the loans have been paid.
"This government is standing by people who work hard and do the right thing, and helping them move on and up in life,” said communities secretary Eric Pickles.
"As part of our wider housing programme, this new scheme will help increase the provision of low-cost rented accommodation and provide a springboard for young people to upgrade to home ownership down the line.”
The future for the long-term health of building industry is looking good and this has been giving building products manufacturers, distributors and merchants the confidence to recruit, invest and promote. Long may it continue. www.pinnacleconsulting.co.uk