Our new mortgage to help buyers of affordable homes to stay local

We’ve launched a new high LTV (loan to value) mortgage to help more first time buyers struggling to step onto the property ladder.

Our Affordable Local Homes mortgage is designed for buyers of affordable properties through the Discounted Market Sale scheme. The fee-free product has a variable rate of 5.54% and is available up to 95% LTV.

Less well-known than Shared Ownership, Discounted Market Sale Homes are properties discounted in perpetuity to act as a stepping stone for first time buyers.

They’re also only available to local residents. While helpful to buyers, the restrictions deter many mainstream lenders from offering mortgages on these homes.

“Most lenders are unwilling to offer home loans on properties with residence restrictions so this lack of mortgage choice risks locking first time buyers out of housing schemes created to help them,” said Daniel Capstick, Ecology’s Senior Mortgages Product and Proposition Manager.

“That’s particularly true of schemes aimed at enabling purchasers to stay in their local area where they have ties to family, friends and work.

At Ecology, we believe being able to preserve these local links is an important part of building and maintaining sustainable communities, so we wanted to create a new product to make it easier for more people to stay local as they step onto the housing ladder.”

Discounted Market Sale Homes include Government schemes like First Homes, local authority projects subject to section 106 agreements, or community-led schemes by groups such as Community Land Trusts.

Daniel continued: “This section of the first time buyer market is growing, but currently under-served by lenders, so we’re asking more mortgage providers to follow our lead and look at how they can support this customer group.”

Affordable housing accounted for 27% of all new homes in England in 2022/23, of which more than one in 10 properties were offered as Discounted Market Sale Homes.

A shortfall of affordable housing is part of the wider housing crisis in the UK, acknowledged by commitments from the current and previous Governments to stimulate affordable housing growth.

Key product features

• 5.54% variable rate up to 95% LTV
• Full term discount
• Mortgage term between 5 and 35 years
• No application fee
• No Early Repayment Charges and unlimited overpayments permitted
• Full Terms and Conditions apply to the above.

Visit the Affordable Local Homes mortgage product page to find out more.

Your home may be repossessed if you do not keep up repayments on your mortgage.