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Assettrust: 'Affordable homes market will remain strong'

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Assettrust: 'Affordable homes market will remain strong'

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Published by Jon Land for 24dash.com in Housing and also in Communities, Finance

Assettrust: 'Affordable homes market will remain strong' Assettrust: 'Affordable homes market will remain strong'

Following Assettrust Housing's successful registration with the Homes and Communities Agency as a not-for-profit Registered Provider, Managing Director Graeme Moran explains why he believes the affordable homes market is a good long-term bet for investment.

Since its inception in 2003 Assettrust Housing has been intent on delivering the supply of good quality shared ownership homes and housing management services.

The application and successful registration of Assettrust Housing Association (AHA) as a not-for-profit Registered Provider seeks to extend this tradition.

AHA is of the firm conviction that customer demand for affordable home ownership will remain strong - particularly among its traditional base of 20-30 year olds on low to moderate incomes. Put simply, this is because:

• The alternative of private renting offers little long term security, inflation busting rent increases in some areas and no hope of building up personal asset wealth – unless you are the landlord.

• The increasing number of the most vulnerable people on social rented housing waiting lists continues to keep, not just the first rungs, but the whole ladder out of the reach of this less needy, although increasingly desperate pool of home-seekers.

AHA believes its models of investment and capital release can help existing housing associations and house builders to sustainably serve this important market.

AHA can help them re-cycle historic public subsidy and capital growth by buying existing residual shares. This should be a welcome contribution to the market, given the likely continuation of cuts in public subsidy for shared ownership programmes and the desire of many housing providers to avoid locking up, for long and uncertain time-scales, large amounts of capital in shared equity schemes.

Without new ways of in investing in affordable home ownership, the personal home ownership aspirations of many lower paid UK citizens will continue to be thwarted. Equally importantly, the crying need of many communities to attract and retain these households to mitigate the growing gap between the haves and have-nots will go unanswered.

How does AHA hope to turn these laudable aims into practical support? Well, its three main proposals are:

• To buy existing shared ownership homes from current Registered Providers, giving them sufficient capital to re-supply new homes.

• To encourage house builders to invest in the supply of new affordable shared ownership homes, accessible to a broad range of households with lower incomes and/or deposits, by giving them the means to speedily unlock their initial investment through the resale of residual shares to AHA.

• To help social housing tenants to buy a share in their existing home, through a product called OwnYourHome, which should generate enough receipt to supply a replacement tenancy.

This last product goes beyond the Right-to-Buy, giving tenants the opportunity to buy into and sustain homeownership and their housing provider the chance to move precious subsidy from less to more needy households. OwnYourHome has the potential to satisfy, on a large scale, the demands of two affordable housing markets while expanding the capacity of the social housing sector at the same time.

So, Assettrust Housing’s long term involvement in promoting and expanding shared ownership means AHA is now ideally placed to attract large volumes of private investment, helping to establish it as a highly efficient and stable asset, of growing scale with a secure long term future, on which to secure liabilities.

Finally, AHA, along with its housing association partners, will be able to assure investors, customers and government stakeholders that the management of the affordable homes and assets is being handled by experienced and skilled professionals in a well-regulated, transparent and accountable framework.

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