I have arranged for details of the eligibility criteria for the Home Choice Loan Scheme, Affordable Housing, Shared Ownership and Local Authority house purchase loans to be sent directly to the Deputy. It should be noted that while provision was made in the Housing (Miscellaneous Provisions) Act 2009 for the replacement of existing affordable housing schemes with a single, equity based Affordable Dwelling Purchase Scheme, this has not yet been commenced.
Under the local authority mortgage protection scheme, an annual premium of 0.56% applies to the capital outstanding. This scheme was recently enhanced to provide cover for the rental portion of shared ownership. This is charged at an annual premium of 0 .334% of the capital outstanding.
Under the shared ownership scheme houses are acquired by a local authority and leased to the shared owner, who purchases at least 40% of the value of the house and rents the remaining equity from the local authority. The shared owner must purchase full ownership outright within 30 years. For transactions commenced on or after 1 January 2003, the annual rent is calculated at 4.3% of the value of the local authority equity and, thereafter, is increased by a fixed 4.5% on 1 July each year. For transactions entered into between 1 May 1998 up to 31 December 2002, rent is calculated at 4½% (5% before 1 May 1998) of the value of the local authority share updated on 1 July each year by reference to the most recently published CPI.
Home Choice loans are available at a standard variable rate only. This is currently 3.35%. Local authority house purchase loans are available at either variable or five year fixed rates. The current variable rate is 2.25% while the five year fixed rate is 4.4%.
In terms of other fees, the administration and processing of applications under the various affordable housing schemes is a matter for individual local authorities, and one in which my Department has no direct function. Accordingly, my Department does not have detailed information on the range of fees applied by individual authorities in providing access to prospective purchasers of affordable housing.