John Ghader, chief executive of Prima Group, is leading a pioneering new housing venture in the United Kingdom. He is putting into place a sweat equity formula that has worked across the United States for decades. This novel program gives participants the opportunity to earn equity in their mortgage by giving their sweat equity up front to help build their future homes. In a smart legal move last month in Ince, Wigan, 13 families just won a major victory. In return, they earned £10,000 worth of credit off their mortgages by doing 500 hours of renovation work on properties owned by the scheme.
It was their first completed project, which crossed the finish line in 2019 with 27 homes, all selling between £190,000 and £197,500. To support this effort, civic tech charity Housing People Building Communities (HPBC) helped organize a 10-week-long CivicTech Sprint run by Prima Group. Volunteers were involved in all aspects of the Center’s work including light construction, painting, landscaping, social media promotion, and even IT assistance. It is worth mentioning that for their time they were paid £20 per hour, in line with the new national living wage for anyone aged over 21.
John Ghader, whose family has deep roots in the area—his children attend a local primary school—expressed a vision for expanding home ownership opportunities. He pointed out how blighted the housing market is today for families. It’s getting more and more difficult for them to find a spot to land without large upfront costs. To her frustration, there is a lack of willingness to understand these arrangements from mortgage lenders, Ghader emphasized.
“What we need now is greater understanding and flexibility from lenders about mortgage products like sweat equity so they can help more people,” – John Ghader.
The program has been most helpful to those who would otherwise find it difficult to save up a large downpayment. D.C. resident and Tiny Homes build participant Rachael McCoy said that the home improvement she was working on helped forge community bonds with her neighbors. That experience created a profound sense of community among them.
“Being involved in building my own home was amazing. It felt like we were building a community before we even got the keys,” – Rachael McCoy.
McCoy explored her lifelong relationship with Ince and how her family struggled to find adequate housing. She’s thankful for the opportunity that the sweat equity program has given her.
“I’ve lived in Ince all my life, and my family are all local. We wanted to stay in the area because my daughter goes to school here, but we needed a three-bedroom home. Getting on the property ladder right now is really difficult, and the mortgage payments would have crippled us,” – Rachael McCoy.
The sweat equity arrangement had found a comfortable home in Wigan. Mortgage lenders, at least until recently, have had a much harder time comprehending its advantages. This gap in knowledge creates difficulties for people who often do not have the time or resources to make their homes more financially sustainable. In the $112,500 millionaire tax amendment, for example, couples only got partial cuts. For instance, one pair made £5,000 after doing the equivalent of 250 hours of work down from the maximum of £10,000.
Ghader underscored the importance of listeners and participants never feeling pressured to do work outside of their ability level. He articulated the unique creative and collaborative spirit that infused the work, with families sharing in the pain of its physical creation—and almost magically, the joy of its return.
“We didn’t force anyone to do anything they were not good at,” – John Ghader.
Through sweat equity, families are able to put their own labor and passion directly into their future home. Rather than relying solely on monetary donations from family or savings, they are able to directly improve their homes. As Ghader described it, some parents chose to keep their kids by going into the workforce with them.
“Instead of putting their hands in their pocket to help with a deposit – something not every parent can afford – some have got their hands on a shovel and contributed to their offspring’s on-site sweat equity hours,” – John Ghader.
The benefit of this program goes beyond debt relief, restoring a sense of ownership and pride among participants. Homeowners have been thrilled to see measurable outcomes from their efforts. One fellow shared a powerful articulation of this emotional attachment to their adopted home.
“Getting £10,000 off my mortgage by doing 500 hours has helped me out massively,” – No specific author mentioned in the text, likely homeowner.
The housing crisis is having a devastating effect on families and children throughout the UK. Programs such as Prima Group’s sweat equity program present an exciting opportunity for anyone looking to create effective affordable housing solutions. This methodology combines community engagement and participatory design with affordable and lasting homebuilding. It addresses financial barriers and builds community connections while creating a common experience among participating homeowners.