Developer Gentoo is to pump an additional £13m into its pioneering home purchase scheme after an agreement to extend it to aspiring homeowners nationwide.
Gentoo Genie, launched in October 2011 to give people an opportunity of buying their own home without saving for a mortgage deposit, will now be made available in the Midlands, East and South East England after the Sunderland firm formed a partnership with Orbit Homes.
And the company has also pledged to increase its investment in Genie from £7m to £20m to boost the number of homes available on a regional level.
Gentoo was heralded as the perfect solution to the mortgage crisis, which has seen millions of people turned down by banks and building societies, after being devised by chief executive Peter Walls.
Walls was determined to root out a way for young people to pay cash into a home, instead of putting money into renting, and the resulting scheme allowed Genie customers to choose their home from a selection of new properties, pay a monthly fee and have total payments fixed for each five-year period.
Customers acquire shares in their home as soon as they start their payment plan and at the end of 30 years own their home outright.
About 60 homes were made available and weeks after its launch the developer reported unprecedented demand for the scheme – demand which is likely to be mirrored now that Orbit is investing £20m in its areas of operation.
The scheme will be available to customers through the Genie home purchase plan, provided by Gentoo Genie Ltd, and it is expected this will be the first of a number of nationwide investments made in Genie in the coming months.
Walls said: “Our intention was always to open up Genie to homebuyers across the country and I am delighted our partnership with Orbit Homes will allow this to happen.
“Following on from the partnership announcement with Orbit Homes, we intend to increase Gentoo’s investment in Genie from £7m to £20m, opening up more properties to would-be homeowners in the North East. Genie was devised specially to help people who otherwise would not be able to afford to, get onto the housing ladder.
“If they don’t have well-off parents who can give or lend the money for a deposit, a lot of people have to make do with paying rent for a home they can never properly call their own.
“Genie is a genuine solution for a number of people who wouldn’t otherwise be able to own their own home.”
Genie is also seeking agreement from the Government that such plans can be included in the proposed government debt guarantees. Steve Hicks, managing director of Genie, said: “This is an exciting development for Genie and for the housing market.
“It was devised to offer a solution to a dysfunctional housing market which has seen people struggle to get into property ownership.
“Genie and Orbit have entered into a memorandum of understanding to agree commercial terms and expect discussions to be finished by the end of August.
“I’m thrilled the investment from Orbit opens up an opportunity to those who live in Orbit’s regions to buy their own home.”