Is Shared Ownership the Answer to First-Time Buyer Woes?

By BridgePoint-Ventures.com

Despite the introduction of
Funding for Lending and Help to Buy, many would-be
first-time buyers are struggling to get on to the property ladder.
According to new research from Shelter, almost two million are
unable to raise the deposit needed to buy their own home, with 1.8
million families facing a lifetime of renting. So what is the
answer to the UK housing problem? Shelter believes shared ownership
could be the way forward and is calling for more schemes to be made
available.

The charity claims a major new house building programme of
shared ownership homes will revolutionise property purchase and put
real estate in reach of “forgotten families”. It works by enabling
people to buy a share of their home – usually between 25 per cent
and 75 per cent of the home’s value – and pay rent on the rest
until reaching a point where they can take on the whole
property.

Research by Shelter has shown shared ownership
mortgage repayments would be affordable for 95 per cent of low
or middle income families. This means more Britons would be able to
afford their own home and pressure would be taken off the rental
market. According to the report, by investing £12 billion the
government would be able to build 600,000 new shared ownership
homes. This means that for less than one per cent of GBP, almost
half of England’s private renting families would have the ability
to get on the property ladder.

Kay Boycott, director of campaigns and policy at Shelter, said:
“We need to see a new generation of shared ownership for the
ordinary families priced out of home ownership. The reality is that
soaring house prices mean that the traditional market is no longer
working for ordinary people. Building the new shared ownership
homes we desperately need is the only way to give thousands of
families a stake in the stable home they want at a price they can
afford.”

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