Property investment firm HomeNow has secured £65m of funding to expand its rent-to-own housing model.
With the money HomeNow is targeting building 800 affordable rent-to-own homes in the next two years.
The firm operates a two-year Home Purchase Plan, where customers are entitled to a rental refund at the end of the period which can be used as a 5% deposit for a mortgage.
Jonathan Potter, chief executive of HomeNow said: “This funding represents a watershed moment for UK homeownership.
“We’re helping solve a £200 billion market problem: 880,000 renters earn over £40,000, we can help them escape the rental trap and achieve their homeownership dreams through a regulated, innovative approach”.
HomeNow currently has 11,000 qualified families on the waiting list.
Potter added: “For the thousands of hardworking families stuck renting and unable to save for a deposit, there’s new hope. We know how frustrating it is for families who do everything right but still can’t get on the property ladder.
“For parents, this is also a practical way to help grown-up children take their first step towards homeownership, without needing to gift a deposit.
“Our clear two-year model flips renting on its head with fair rents fixed for the whole period and a portion refunded toward a deposit; no hidden fees and brand new, energy-efficient homes that reduce monthly outgoings. Every monthly payment moves you closer to owning your own home”.