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Intermediate Market Rent

This content applies to England

A scheme for tenants who, in the short term, can afford more than social rents but cannot afford low-cost home ownership.

How the scheme works

Intermediate Market Rent (IMR) offers new build homes to rent at less than the market rent. Homes are available from a range of private registered providers of social housing (PRPSHs) on an assured shorthold tenancy, usually for an initial period of six months.

Applicants must:

  • demonstrate how the discounted rent will enable them to save for a deposit
  • commit to buy a home through shared/low cost home ownership schemes within five years of entering IMR.

Local market rent

The rent payable under IMR must not exceed eighty per cent of the local market rent. It will be for PRPSHs to determine what the local market rents are.

Rent increases

The Affordable Housing Capital Funding Guide recommends that any rent increases in excess of the Retail Prices Index (RPI) plus 0.5 per cent should be both affordable and fair to IMR tenants. Rents must remain at less than 80 per cent of the market rent throughout the tenancy.

Advance rent and deposit

PRPSHs can request the first month's rent in advance when the tenancy agreement is signed plus a returnable deposit of a further month's rent against breakages/damage. The landlords must comply with the statutory tenancy deposit protection scheme (see Deposits for more information).

Service charges

PRPSHs can charge a reasonable amount to cover either fixed or variable service charges. The rent charged to tenants should not exceed eighty per cent of the market rent with service charges included.

Who can apply

To be eligible for IMR the applicant must:

  • have a household’s total income of less than £66,000 per annum
  • be unable to afford to buy a suitable property on the open market without assistance
  • be able to afford eighty per cent of the local market rent without recourse to housing benefit
  • be formally assessed by, and registered with, the Local HomeBuy Agent.

Applicants may be prioritised according to locally determined factors such as housing need, where the applicant lives, and the social need for certain employees in that area (eg public sector workers who are not key workers). Priority may be given to local authority and PRPSH tenants who would vacate social rented accommodation if they rented through IMR.

More details about eligibility criteria can be found in the Affordable Housing Capital Funding Guide.

How to apply

Local HomeBuy Agents deal with applicants and formally assess them against eligibility criteria.  Prospective applicants should contact their Local HomeBuy Agents to register and receive specific information relevant to their individual circumstances and area(s) of interest.

Types of property available

Only certain new build or renovated properties can be rented through the scheme. The developer will usually be a PRPSH.

Security of tenure

Tenants renting under the scheme will be granted an assured shorthold tenancy, which could be fixed term or periodic depending upon specific circumstances. For more information see Assured shorthold tenancies.

Joint applications

Where the property is let to joint applicants, a joint assured shorthold tenancy will be granted.

Right to acquire

Time in properties rented through the IMR scheme will not count towards the qualifying residency period for the right to acquire.

Options after Intermediate Market Rent

Many PRPSHs that let properties through the IMR scheme also offer an option to buy a share in the property at a later date. See Help to Buy shared ownership for more information.

Some PRPSHs may ask applicants to agree to purchase the property after a pre-defined period. This is called Rent to HomeBuy. More information on the Rent to HomeBuy scheme is available from Gov.uk Affordable home ownership and from Local HomeBuy Agents.

Wales

The information on this page applies only to England. Go to Shelter Cymru for information relating to Wales.

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