If stepping onto the property ladder feels like an impossible task, then the Home Stepper shared ownership scheme available in partnership with Sage Homes could be for you.
It allows buyers of new homes to purchase a share of their chosen home and pay a monthly rent on the remaining part.
What is Home Stepper?
We’ve teamed up with Sage Homes to offer Home Stepper, a shared ownership scheme that enables you to purchase shares up to 75% of the home you would like to buy, based on your level of affordability.
Once you buy your new Countryside home, Sage Homes then becomes your landlord, granting you a 990-year lease while you pay them rent on the unowned share of your home.
The great news is, you’ll be able to live in your home as if you’ve bought it outright. Over time you can increase the share of the property you own and decrease the share that you pay rent on.
Home Stepper is only available on selected homes at certain developments.
Who are Sage Homes?
Sage Homes is England’s largest provider of newly built affordable housing with the goal of helping to address the housing crisis by providing affordable housing to those most in need. They provide both new Shared Ownership (part buy, part rent) and rental homes and have handed over the keys to more than 10,000 homes in the last five years.
For more information on Sage Homes, visit their website https://www.sagehomes.co.uk/
Benefits of Home Stepper
The Home Stepper scheme helps make buying a new build home more accessible, with smaller deposits and lower monthly payments that could mean buying a new home is more affordable than you thought.
You can purchase your share with either cash savings or by taking out a mortgage. If you are taking out a mortgage to finance your share, you will typically need to allow for at least a 5% deposit. The larger your deposit, the lower your mortgage payments will be.
On the share you don't own, you will pay monthly rent of 2.75% of the unsold value to Sage Homes.
Who is eligible for Home Stepper?
If you think using Home Stepper would be a good fit for you, there area few criteria that you’ll need to meet to be eligible to use the scheme:
- Your household income does not exceed £80,000 per annum (or £90,000 in London)
- You have a deposit of at least 5% of the share value
- You plan to live in the shared ownership property as your principal and only home
- You have passed a financial assessment, demonstrating you are financially able to purchase the minimum share value and support the monthly costs
Home Stepper is available on selected Countryside Homes and eligible homes will be advertised on our website. Please check availability with our sales consultants.
This is dependent on your individual financial circumstances, but you can initially buy up to a 75% share of your home based on your level of affordability.
Yes, you can choose to increase your share of home ownership gradually through a process known as ‘staircasing’. This means that, over time you could own 100% of your home, at this point a transfer of the freehold interest of the house or a transfer of the full leasehold interest of the apartment/flat will need to take place.
Rent will be paid directly to Sage Homes and the monthly amount you will pay depends on the value of your home and the size of the share that you decide to purchase. Rent will be paid on the unpurchased share of your home (which is owned by Sage Homes) at a rate of 2.75%.
Your rent will be reviewed annually on 1st April and is usually in line with the year-on-year change to the Retail Price Index (RPI) plus 0.5% in the preceding 12 months. These terms are clearly set out in your lease and our sales teams are on hand to explain the process to you.
In addition to the rent you pay to Sage Homes, you will need to pay 100% of your household bills, including council tax and utility bills, as well as 100% of the costs of any maintenance fees and estate charges that are applicable to the home you choose.
An annual leasehold management fee will be payable directly to Sage along with your service charge, this is £195 per annum, which increases each year with inflation. The terms are clearly set out in your lease.
The term “Shared Ownership” refers to the fact that you are acquiring a percentage share of the home, with Sage Homes owning the remaining percentage of the unacquired share. During the term of the lease, you are able to live in the home as if you own it outright (subject to the terms of the lease). Whilst you are welcome to purchase a Countryside Home with another person, this is not a requirement of the Home Stepper Shared Ownership scheme. If you are purchasing the property with another person, then your combined household income must not exceed £80,000 (£90,000 in London).
Sage Homes will provide buildings insurance and payment for insurance will be included within the service charges, your IFA will be able to tell you how much this will be. You will need to arrange your own contents insurance separately.
You will be able to sell your home at any time. You will need to firstly notify Sage Homes that you wish to sell the property, Sage Homes will then arrange an independent RICS valuation to establish the sale value of your home. The purchaser(s) will need to meet the Home Stepper eligibility criteria. Sage Homes then have 4 weeks from receipt of your intention to sell notice to nominate a purchaser(s) (Sage Homes nominee) so that other people can benefit from the scheme.
If a Sage Homes nominee cannot be found to purchase your home, or if one is found, but fails to exchange contracts with you within 12 weeks of your solicitor issuing the draft sale contract (and related sale documentation), you are then able to sell your home on the open market. If you do so, on completion of the sale you must repay to Sage Homes, the market value of the unacquired percentage share (the percentage share Sage Homes owned, prior to the sale).
You will also need to pay the fees of the process including the valuation, Sage’s fee of 1% of the full market price (to advertise the property for sale), legal fees and admin fees.
Yes, you will be required to pay stamp duty, this will be based on the percentage share of the home you are purchasing, subject to any allowances which may be offset against the Stamp Duty payable. Please ask your solicitor to calculate this for you.
All Shared Ownership customers that purchase a Countryside Home under the Home Stepper scheme are responsible for completing and/or paying for repair works that are not covered by the Countryside Homes two-year customer service warranty or the NHBC’s 10-year building warranty.
If your chosen home is sold with white goods such as a fridge and washing machine, each of these items will be covered by an individual guarantee which will be provided to you on legal completion.
Yes, you can decorate your new home as you like. However, if you wish to make any significant alterations to your home, such as an extension, you will need to seek permission from Sage Homes/Countryside Homes and obtain any relevant planning permission. The precise terms of what alterations you can and cannot make to your home will be set out in the documentation provided.
Sage Homes as the provider of the Home Stepper scheme will need to provide consent for you to keep pets at the property and you will need to contact them directly.
Whereas most Shared Ownership leases do not allow you to fully sublet your home, Sage Homes will consider granting permission for you to take a lodger on a case-by-case basis, you would need to contact Sage directly in this regard.
Yes, it is usual for Landlords of leasehold properties to be notified of your mortgage lender as the lender will register a Legal Charge on the title to the property. Sage will need to approve your mortgage offer and there is a charge of £50 (+VAT) for this process. In addition, on legal completion Sage will need to be served a Notice of Charge (Notice of your mortgage lender) in accordance with the terms set out in the Shared Ownership lease, the Notice of Charge fee is £75 (+VAT). The solicitor acting for you in relation to your purchase of the property will include these fees in your completion statement and these will be payable on the day of completion. If you are buying your share without a mortgage, then neither of these fees will apply.
Home Stepper is available on selected new build homes only, subject to contract and eligibility criteria. Home Stepper is a new build shared ownership scheme brought to you by Sage Homes. The scheme is subject to individual mortgage lender qualification and affordability criteria as prescribed by Homes England. The scheme is subject to you first obtaining approval from Sage before reserving a new home from us. Eligibility for the scheme may be withdrawn at any time prior to reservation. Sage may also require evidence of your financial ability to proceed with the purchase of a new home from us. Shares from 10% up to 75% of the new home are available. Prices advertised can represent up to a 75% share of the new home. Rent will be charged at 2.75% of the unacquired equity share and is reviewed annually in line with the year-on-year change to RPI in the preceding 12 months plus additional 0.5% and an annual fee of £195. The property will be sold on a shared ownership leasehold basis with a term of 999 years and a monthly management fee is also payable. You will be an assured tenant with Sage Homes as the landlord until such time you staircase to own 100% of the property. More information on eligibility and affordability of using Home Stepper to purchase your new home can be found at www.sagehomes.co.uk . Home Stepper is also subject to the terms and conditions of Sage Homes. Home Stepper cannot be used in conjunction with any other offer, discount, promotion or scheme. Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it. Subject to individual lender terms and conditions. Our usual reservation and sales terms and conditions also apply. Please speak to one of our sales consultants for more details.