Unlocking affordability in a challenging market

For the second year in a row, 2009 presented challenging trading conditions. The Bank of England Base rate fell from 5% to 0.5%, but this did little to kickstart the mortgage market. Although house prices began to stabilise, consumer confidence remained fragile and lenders continued to manage their risk profile by restricting access to mortgage funding.

High loan-to-value mortgages disappeared and the number of mortgage products available to our customers shrank significantly. Down valuations, and managing purchaser expectations of these, presented an ongoing challenge for sales teams. The requirement for large deposits excluded first time buyers from entering the market, however the introduction of Homebuy Direct and other tailored incentives towards the end of 2008 has helped this group of buyers.

The Group continued to successfully bid for Government funding opportunities. Crest Nicholson secured funding through Homebuy Direct to support 881 dwellings across 37 projects.

HomeBuy Direct, a new initiative from the HCA, is designed to be a "stepping stone" to home ownership, enabling first time buyers to secure a brand new home for initially just 70% of the asking price. By working with Government, Crest Nicholson in equal partnership with local Homebuy Agents, has been able to provide equity loans of often up to 30% of the purchase price. This has kept the mortgage market moving and unlocked home ownership for those who have found it increasingly difficult to get on the property ladder.

Getting on the ladder

Colin Simms-Cato and his partner Anna Costarz knew that to get onto the property ladder they would need to take advantage of a housebuilder's incentive. They wanted to purchase in London to be close to family and friends and to have an easy commute to work. They discovered Great West Gate and found the development was perfectly situated for all their needs and the HomeBuy Direct scheme on offer meant they could afford to take their first step onto the property ladder.

Colin comments, "When Anna and I looked at GreatWest Gate we really liked the development and the setting. It's in a perfect location to get into the City with lots of transport options, has a great park and is close to my family and friends. We were so pleased that the HomeBuy Direct initiative was on offer at GreatWest Gate as we wouldn't have been able to buy our first home without it."

Our Easybuy scheme

Throughout 2009 we continued to offer our own shared equity product, Easybuy. This ensured that those first time buyers who were unable to qualify for HomeBuy Direct still had the opportunity to buy a new home. EasyBuy is a scheme where buyers can own 100% of their own home for just 75% of the price. This is not a shared ownership scheme, the balance is funded by a loan from Crest Nicholson, secured against the property. Buyers have to repay the balance when the home is sold or within ten years, whichever comes sooner.

Ensuring a fair market value

We are passionate about transparently communicating targeted offers and incentives to prospective purchasers. We extensively research the local socio-economic mix when considering the viability of a new development to ensure that we bring an appropriate and affordable product mix to the market.

Our thorough approach to pricing ensures that we sell our homes in line with the local market conditions. Our Sales Advisors are encouraged to explain how we arrive at our prices so that purchasers are fully informed and can be comfortable in the knowledge that they have paid a fair price for their new home.

Find out more in Supporting and rewarding our teams.

We place the utmost importance in the role that Independent Financial Advisors (IFAs) play when advising our purchasers. To support this in 2009 we introduced a monitoring process, via our customer satisfaction questionnaires, to ensure that IFAs are delivering the high levels of service that we believe our customers should receive.

Find out more in Putting customers first.

Read More

See how we are supporting and rewarding our teams.