The State provides financial support to housing costs through tax foregone, direct housing provision and direct subsidies, grants and  allowances.

The Housing Finance Agency is  a state organisation that was designed to tap financial markets in order to advance funds to local authorities for the purpose of loans under the Housing Act. The agency advances  loans to local authorities for their housing functions, and also lends to individual housing bodies and voluntary organizations. The HFA may transfer the benefit of the loans in its portfolio. The State guarantees the borrowings of the HFA.

Formerly, local authorities provided mortgage finance for the purchase of residential properties. Since 1970s, the proportion of local authority financing house has reduced considerably as building societies, banks, and other financial institution became the principal providers of housing finance.

State loans were restricted in 1980s to those who are unable to secure a commercial mortgage loan. Former income-based mortgages were replaced by normal prepayment mortgages completely in the 1990s. The number of local authority mortgages has declined very significantly so that it now represents a small part only of the housing market.

Commencing in the 1970s,  but accelerating through the 1980s and 1990s, the vast majority of local authority constructed houses were sold to the tenants on favorable terms. Such homes represent over one quarter of owner-occupied houses.

Different tenant purchase schemes were made over the years. Each involved a substantial  discount on the market price linked to the number of years’ tenancy. Owners also benefited from the first-time buyers grant and various other subsidies and discounts.

A number of affordable housing and shared ownership schemes were developed  in late 1980s and \’90s. Under the schemes, the owners acquired a long lease, but at a rent at a certain portion, usually meeting 50 percent of the market rent. In the sense, the ownership was shared and that the notional share owed by State was rentalised.

The schemes were designed to recoup the State share housing authority share upon sale.

The various schemes were subjected to qualifications, including the income levels and  maximum prices.


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