Six new properties for sale 'at substantial discount' from Kilkenny County Council

- FOR SALE -

6 Newly Built Affordable Homes 
Nos. 9-14, Limegrove, Oakridge, Ferrybank, Co. Kilkenny
Purchase Price: €229,000 (subject to discount)

Kilkenny County Council are offering local households the opportunity to step foot on the property ladder by purchasing newly-built homes at a substantial discount under the Incremental Purchase Scheme.

The Incremental Purchase Scheme is a purchase option to meet the needs of those requiring long-term housing support.

The scheme supports existing low-income tenants and assist prospective local authority tenants to make a start on the route to home ownership.

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READ BELOW FOR FULL DETAILS ON SCHEME AND LINKS TO RELEVANT FORMS

There are two types of household that can be considered for inclusion in the incremental purchase scheme:

(a) Households that have been assessed by Kilkenny Local Authorities as being eligible for and in need of social housing support.

(b) Households who are already in receipt of social housing support from Kilkenny Council, i.e. existing Local Authority or Approved Housing Body tenants and households accommodated under RAS (Rental Accommodation Scheme), HAP (Housing Assistance Payment) Scheme and Long Term Social Housing Leasing Scheme.

Under this scheme, the purchaser pays a discounted price for a new house and in return receives full ownership of the house and responsibility for maintaining the house and insuring it.

The housing authority in turn places a reducing charge on the property that is equivalent to the discount afforded to the purchaser.

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The broad terms of the scheme are as follows:
• the scheme will apply to new-build houses only;
• the charged share is released to the purchaser over the period of the charge as follows:- the charged share reduces in increments of 2% of the total equity in the dwelling over the charge period
- the 10% reduction for the first 5 years after sale is released at the end of year 5
• the property can be resold by the purchaser at any time at market value with the housing authority being paid, from the proceeds of the sale, an amount equal to the proportion of the outstanding equity charge in the property;
• the housing authority has first option on buying the property in the event of the resale of a dwelling by the purchaser during the charged period; and
• special arrangements will allow purchasers to undertake improvement works with the agreement of the authority.

You must have a gross annual income of not less than €15,000 in order to be considered to purchase under the scheme.

Only the income of the applicant or joint applicants will be assessed for the purposes of determining whether an applicant household meets the minimum income requirements of the scheme.

Reckonable income must come mainly from regular employment and not solely from social welfare.

This includes income from wages, salaries, and some social welfare payments but only where they are additional to employment income.

There are certain income disregards listed on the application form, which shall not be regarded as assessable income for the purposes of the Incremental Purchase Scheme.

Eligible applicants must satisfy the Household Means Policy to determine income eligibility and affordability.

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• Arrears
You must not have been behind in your rent or local authority charges for more than
12 weeks in the past three years. If you were, you must have made a payment
arrangement with your local authority and be following that arrangement.

• Previous ownership
You must not have previously bought a dwelling from any housing authority.

• Finance
You must provide approval in principal or evidence of how you are going to finance
the purchase at the time of application. You must show your local authority how you
intend to pay for the house. If you are buying your house with a mortgage loan, you
must provide approval in principle at the time of application.

Who will maintain the house after I buy it?
Like all homeowners, you will be responsible for maintaining and carrying out repairs on your house from the date you buy it.

You will also have to get and keep adequate property insurance on your house and pay for this yourself. As the owner of the house, you will be responsible for the payment of the local property tax for the house.

Are there restrictions on the use of the house after I buy it?

Yes. You must:
• live in the house as your normal place of residence
• get agreement from your local authority if you want to sell, assign, let/sub-let the house;
• not engage in anti-social behaviour or be a nuisance to your neighbours and
• the purchaser may not make any material improvements to the house without the prior
written consent of the housing authority

How much will I pay for the house?
The purchase price of the dwelling is equal to the cost to the authority of providing
the dwelling in the first place, less a discount.

What discount will I get?
Depending on your gross annual income, the discounts will vary between 40% and
60%. The discount will be given against the purchase price of the dwelling determined
by the local authority.

Example:

If the local authority determines the purchase price as €289,000 and your gross annual income is €18,000, you will get a discount of 60% against the purchase price.

This means you will pay €115,600 for the property.

However, the local authority will place an incremental purchase charge on the house equal to the discount you get.

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What is the incremental purchase charge?
One of the conditions of the sale is that the local authority will place an incremental purchase charge on the house equal to the value of the discount you get. This charge will reduce to zero over 20, 25 or 30 years (called the ‘charge period’), as long as you obey the conditions of the sale under the scheme.

You will have to pay back the value of the outstanding charge to the local authority if:
• you sell the house before the end of the charge period; or
• your incremental purchase charge is not reduced for one or more years because you did not obey the conditions of the scheme. It remains due for repayment at the end of the charge period.

The period of the incremental purchase charge will depend on the discount. For example, if you get a discount of 50% based on your gross annual income, the charge period will be 25 years.

How do I finance the purchase?
You will have to pay the purchase money in full at the time the house purchase is completed. You will be responsible for raising the money to do this (for example, from savings, a mortgage loan, and so on).

You must meet the local authority’s requirements in relation to how you are going to pay for the house.

If you can afford it, you can buy your house without a mortgage loan as long as you meet all the eligibility criteria.

This includes having a gross annual income of at least €15,000.

You must have this income so that you can maintain your house during the charge period.

You must show your local authority how you intend to pay for the house. If you are buying your house with a mortgage loan, you must provide approval in principle at the time of application.

You will not have to pay a deposit as part of your purchase.

You may be able to apply to your local authority for a Rebuilding Ireland Home Loan.

You will have to pay all your costs, including legal fees, to complete the purchase of your new home.

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How do I apply?
• You must fill out an Incremental Purchase Application Form available on the Kilkenny County Council website or by contacting Customer Services
• You must provide proof of income
• You must show your local authority how you intend to pay for the house
• If you are buying your house with a mortgage loan you must provide approval in principle at the time of application
• You must give the local authority any other information if asks for about your application

How will my application be processed?
In general, your application will be processed in four stages:

Stage 1 – Income, Tenancy Eligibility and Confirmation of Purchase Funding Kilkenny County Council will assess your application to make sure it follows the rules about income and tenancy. It is important to provide all the supporting
documentation requested. This is to make sure your application is acceptable. Support documents include statement of liability, employment detail summary, payslips, and salary certificates and so on. If we ask for more information, you must
supply it within the time specified. If you do not qualify for the scheme, your local authority will inform you. You will have to supply evidence (such as a bank statement of savings or a letter of loan offer from your lender) to show that you have the money to complete the purchase.

Stage 2 – Allocation of Homes and Letter of Offer
There are a certain number of dwellings for sale under the scheme. All valid applications will be considered by the allocations team after the closing date. In the instance where there are more applicants than properties, shortlisting will occur
based on the Council’s Allocation Scheme.

If successful your local authority will send you a ‘letter of offer’, outlining:
• the purchase price of the house
• the discount you may get under the scheme
• the price you must pay to complete the purchase
• the terms and conditions regarding the sale
• a viewing of the property will be arranged

The offer will last for a set period. All successful applicants will be required to obtain independent legal advice and pay their own legal costs to process the sale of the property. These and other associated costs must be considered when applying.

Stage 3 – Accepting the offer
If you are happy to accept the offer and go ahead with the purchase, you must confirm it in writing within the timeframe specified. The legal transfer of the new property will start only when this stage has been completed.

FOR FULL DETAILS ON THIS PATRICULAR HOUSING SCHEME AS WELL AS APPLICATION FORMS, CLICK HERE.

Closing date for receipt of applications for the purchase of these 6 houses is April 1, 2022.

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