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Frequently Asked Questions

The FAQs below explain HOP in detail.  These are designed to be a guide and are subject to change. Upon being accepted into HOP, you will receive a Homebuyers’ Guide with all the key facts.

If you have any questions that are not answered below, please email us at info@hophomes.co.uk or call us on  +44 (0) 20 7930 8600.

What is HOP (in summary)?

HOP is the smarter way to home ownership: you contribute a minimum of 10% in cash and HOP’s investors contribute the rest.

You choose your forever home: provided that your home is a sound prospect and you pass our affordability rules, HOP’s investors will co-invest and enter into a long-term lease alongside you.

Like a homeowner:

  • you have long-term security; as long as you pay your bills nobody can ever make you leave.
  • you can personalise your home: all we ask is that you talk to us first.
  • you can have pets.
  • you can rent a room to a lodger.
  • you can gain from any increase in value of your home.
  • you can sell whenever you want.

You pay a monthly HOP payment: this is 5% per annum of the share you do not own (HOP’s investor’s share). This monthly payment increases by Retail Price Index (RPI) + 0.5% per year and this is capped at five percent.

You pay for repairs and your buildings insurance, which we arrange for you.

You receive the lion’s share of any increase in the value of your home: for example, in ten years you will have earned more than half of the increase in your home’s value (=51%).

How is HOP different to a mortgage?

  • HOP can lend up to six times your household income, which is more than a typical mortgage lender
  • Your monthly HOP payments are linked to inflation, not interest rates
  • You will not need to renegotiate or find another mortgage
  • With a mortgage you absorb 100% of the decrease in your home’s value; with HOP it is shared with HOP’s investors.

Buying a home with HOP

Can I buy a home with HOP now?

Not yet, but HOP will launch soon so please make sure that you have registered your interest with us.

Register your interest

Are there types of properties and locations that HOP will not consider?

HOP is only able to offer co-investment in freehold homes, which excludes flats. 

HOP is only considering co-investment in homes within England at this time.

How much will HOP cost me?

  • At least 10% of your home’s value: you can buy a higher share, which will reduce your HOP monthly payment.
  • £1,800 (including VAT) HOP fee: this covers the RICS Homebuyers Report (with survey or valuation), conveyancing searches, and our own administrative costs.
  • Allow for at least £1,000 (including VAT) for solicitors’ fees (including disbursements): these are the fees that you will pay your solicitor who works on your behalf on the purchase of your HOP home.
  • You will not pay Stamp Duty on the purchase price of your home: this is because your contribution of 10% or more to the purchase price of your home is zero rated below the £125,000 threshold.
  • You will pay Stamp Duty on the rental part of the HOP lease (HOP payment): Your solicitor will calculate this as part of the conveyancing process using the Government’s online rental Stamp Duty calculator.

How do you assess whether I can afford to buy with HOP?

As responsible partners, HOP will check that you can afford HOP’s monthly payments. We know that most people’s wages rise, so factoring this into our affordability assessment allows HOP’s investors to co-invest more than a typical mortgage lender.

HOP will arrange co-investment of up to six times your joint household income. Please do your own affordability check here:

 

Affordability Calculator

How do I work out my household income?

Household income is the combined gross annual income (before tax & deductions) of all the members of a household who are of a legal working age and are going to be applicants and own a share of the property, up to a maximum of two applicants.

Can I HOP if I already own a home?

You cannot HOP on a home that you already own.

However, you will not have to sell existing buy-to-let property or other investments, but your HOP home will need to be your main residence.

Is a lease involved?

Yes. A lease is a recognised shared home ownership agreement that protects both parties’ rights in law and is what allows us to give you flexible home ownership options. Property interest acquired by you will be on a HOP shared ownership lease, which will be for 125 years.

Who organises the Homebuyers Report?

HOP arranges the RICS Homebuyers Report (with survey or valuation), which is a report that assesses the condition and value of the property.

What happens if the property is valued lower than the asking price?

You can try and negotiate with the vendor to reduce the price; or increase your cash contribution so that HOP’s investors are only providing a maximum of 90% of the valuation.

If I change my mind at any time, can I withdraw from the process?

Yes, until the exchange of contracts you are not legally bound. However, you will bear the costs of withdrawal, as none of the fees you incur will be refundable.

What happens if the purchase doesn’t go through?

If your offer on a home is not accepted or there are complications before exchange, we will ask you to put an offer on another chosen property.

If your home purchase falls through, you will be asked to pay only for a new survey on the next purchase.

Can I have a lodger?

You can rent a room as long as the property is your main residence and you are still living there.

Can I have pets?

Yes! We understand that a pet can be a part of your family.

What are the ongoing costs of HOP?

HOP monthly payments

In return for HOP arranging co-investment in your home, you make a HOP payment each month in year one which is 5% of the HOP investors’ co-investment amount.

How do my monthly HOP payments increase each year?

Payments increase in line with inflation (also known as the Retail Price Index, or RPI), plus 0.5%. HOP caps these payments to never increase by more than 5%.

What is Retail Price Index (RPI)?

In the United Kingdom, Retail Price Index (RPI) is a measure of inflation published monthly by the Office for National Statistics. It measures the change in the cost of a representative sample of retail goods and services. The RPI is used by the government as a base for various purposes, such as social housing rent increases.

What else will I need to pay in addition to HOP payments?

You will need to pay for the buildings insurance for your home. We will arrange the insurance and recharge this to you. Our group insurance policy will be at a lower cost than you could find on the open market.

Repairs and improvements

Who is responsible for the upkeep and repair of the property?

You will be responsible for the upkeep and repair of your home.

What about improvements?

With a HOP co-investment we want you to feel 100% at home, so you can decorate your home.

Even though the HOP lease does not allow for structural or exterior changes (common across most shared ownership leases), in practice you can talk to us if you want to make alterations. This is a requirement of most mortgage lenders.

If HOP’s investors agree with your upgrade or structural proposal, we can create a side agreement between you, the investor and HOP to allow it. HOP’s investors may also help with the cost of the improvements and we will agree the change in HOP payments with you.

Sharing your home’s value growth

What happens if my home increases in value?

Example: After ten years, your share of the increase in value will be 51%.

So if your £300,000 home increased in value by £100,000 and you decided to sell, you would receive £51,000 being your share of growth.

View Gain in Value Share calculator

What happens if my home decreases in value?

In a worst-case scenario, your £300,000 home decreases to £250,000 over ten years. In this case 51% (£26,000) would be deducted from your initial investment of £30,000 (10%) and the remaining £4,000 would be returned to you.  

Can I increase my share in the property?

Yes, you can increase the share that you own in your property over time, up to 100% if you wish. If you increase your share in the property, the amount of HOP payments you pay will be re-calculated and reduced.

You can buy an additional share at any time up to twice a year with a minimum amount of £10,000. We call this ‘HOP Up’.

As you will be buying more of your property there will be associated costs to pay.

What happens if I run into financial difficulties?

If you run into financial difficulties, talk to us as soon as possible so that we can help.

We will work with you and support you as much as we are able. As every person’s situation is unique, we would work hard to find a solution that meets your circumstances.

Our aim is to ensure you are able to stay in your home for the long-term.

Who are HOP?

HOP is a team of people all working to the same vision: to create a smarter way for people to own their forever homes. We designed HOP Homes to bring together consumers struggling to get the mortgage they want with investors looking for long-term investment in residential property.

HOP creates your co-investment partnership and is there to support you throughout the whole time you live in your home.

Learn more about us