Change of plan for new Preston houses after lack of interest in spite of price cut

The nine properties in Cottam have been “extensively marketed” since last summer, according to the housing association responsible for them - and have even had their prices reduced - but remain unsold.

Now, Bolton at Home Limited wants permission from Preston City Council to reclassify them as so-called “rent-to-buy” dwellings for those trying to get their first foot on the property ladder.

The organisation acquired the total 36 units that fall into the affordable homes category on the estate, which forms part of the wider Cottam Hall development that dates back more than a decade.

Shared ownership is open to people who cannot afford the full deposit or mortgage payments for a home that meets their needs. Instead, they are able to buy part of the property - between 10 and 75 percent - and pay rent to a landlord on the rest.

Over time, the part-owners can increase their share and will see a corresponding reduction in their rental payments.

In contrast, rent-to-buy offers potential house purchasers who cannot initially cover the cost of a deposit the time to save up so that they can afford that lump sum layout and get a mortgage.

That is achieved by cutting the rent payable on the property, usually to 20 percent below the market rate. The money that would have been spent on rent can then be saved to fund the deposit at a later date.

Government guidelines say that initial tenancy agreements should be be for up to two years. After that, if a renter needs more time to save for their deposit, their landlord may agree to extend their tenancy.

The home becomes available to buy as soon as the person or family living there has enough money for a deposit and can arrange their mortgage.

To be eligible for rent-to-buy, a prospective purchaser must be a first-time buyer, in full or part-time employment and in a position to pay the discounted rent and save at the same time. A person may also be able to rent-to-buy if they are returning to home ownership following a relationship breakdown.

Shared ownership is also open to first-time buyers, but not restricted solely to that category of purchaser, as is largely the case with rent-to-buy.