Substantial help for first-time buyers

the Housing Authority recently introduced its new equity sharing initiative. This scheme aims to help first-time buyers who want to purchase property from the private sector. In cases where the price of property cannot be reached through a bank loan, the authority helps by covering the shortfall between the borrowed sum and the price of the property.

Under the scheme the Housing Authority finances up to Lm10,000 for the purchase of a first residence in shell form, and up to Lm14,000 for the purchase of a first 'finished' residence. Thus the authority becomes a part-owner of this same residence. Applications for the purchase of property, the value of which does not exceed Lm50,000, will be given preference. However all property is being considered.

Commenting on this initiative, Marisa Micallef, chairman of the Housing Authority, said: "The Housing Authority board is hoping that models of equity sharing will become the main way we help first-time buyers in the future, while we reserve shared ownership for slightly lower income groups as well as groups with more particular needs. At this stage, with prices still or not rising as fast as in recent years, it may be an excellent time for first-time buyers to negotiate and find their first home. The scheme is still in its infancy and we hope, depending on the clients we attract, to further enhance it so it can help more people, not least single people under 30, who, for now, are excluded, but whom we hope to also help, funds permitting."

Beneficiaries are not obliged to buy back the investment made by the Housing Authority before 10 years from the date of contract. After this period the Housing Authority will obtain the necessary information to verify whether the applicant is in a position to pay back or take an additional loan.