The Ecology Building Society is extending its mortgage terms for community-led housing providers from a maximum of 30 to 40 years to help grow the sector.
The West-Yorkshire based building society, which has over 10,000 accounts, specialises in lending for affordable housing and environmental building.
The move is aimed at tackling high property prices, which can make it difficult to create new housing co-operatives as the level of their borrowing makes it challenging for new housing co-ops to maintain rents at affordable prices.
“At Ecology we’re committed to supporting community-led housing such as housing co-ops. We recognised that the current state of the housing market makes it difficult for housing co-ops to start-up so we were delighted to identify an innovative solution which will help support the sector’s growth.”
Radical Routes, a national network of housing and worker co-ops welcomed the change.
“Radical Routes is extremely pleased that a 40-year mortgage can now be considered by Ecology.
“Firstly, it greatly helps make housing co-op cash-flows more viable at affordable rent levels – in fact, it will make some projects possible that otherwise wouldn’t go ahead.
“Secondly, it spreads the cost more fairly between members who joined the co-op early and those who join later,” said a spokesperson.
