By Martin Fillery, Head of Shared Ownership, Currell
If the government is serious about making any real progress in solving the housing crisis, it needs to implement measures to grow the shared ownership sector. An increasing number of people cannot afford to buy a home, even with stable employment and savings for a deposit. The gulf between the funds they can raise and the costs of buying a home is just too great.
Shared ownership, which is deigned to bridge this gap, therefore has an increasingly important role to play in the provision of affordable housing across the UK, especially in increasingly unaffordable London and the South East.
There are several measures the government should take to help grow this part of the housing market, from the most obvious steps of building more shared ownership homes and cutting stamp duty (particularly for first time buyers), to a pro-active marketing campaign to promote this route to purchase, which is still widely misunderstood.
Whilst many may be content to remain forever members of ‘generation rent’ there are plenty who want to buy but lack the means to do so without some help. Not everyone can resort to the bank of mum and dad, and even those who can often need additional assistance. These renters are ideal candidates for shared ownership purchase, but many either don’t realise they are eligible or have unfounded prejudices about shared ownership properties.
The government needs to embark upon a pro-active campaign to advertise ‘Help to Buy: Shared Ownership’, working with bodies such as the National Housing Group to raise the profile of the sector. It should also adopt a more joined-up approach to administering the scheme, which should be done on a national rather than regional basis, with properties advertised on a single national platform.
This platform could provide information about the typical costs of renting vs buying via shared ownership per region, and could also assess eligibility. Improved awareness of regional price differences could encourage people to move to areas that are more affordable to them (eg the outer boroughs of East London), and the government could incentivise this by reducing commuter rail fares.
Education about property should start early, with government information packs suitable for schools and colleges, explaining the process of renting or buying a home, and the different routes available. This could form part of a larger education programme about managing personal finances and understanding concepts such as loans, mortgages, savings and interest rates.
In terms of finance, we would like to see the government encourage more lenders to offer mortgages for shared ownership purchase, including fixed rate products to provide certainty in these uncertain times.
Finally, we would of course like to see a cut in stamp duty. This is particularly important for first time buyers of shared ownership products, who have to juggle their resources to cover the many up-front costs of buying a home.