Walker Morris has reported recently on the fact that, despite shared ownership potentially offering an affordable route to home-ownership, there currently remain various problems for shared ownership scheme offerings to overcome.
For example, there is still relatively low awareness of the schemes within the UK housing marketplace generally; only some 10% of shared owners have so far managed to increase their equity stake; and some 52% of respondents to a YouGov survey on the subject didn’t know that they could move from their current home to another shared ownership property.
The UK Government has stated that it is committed to helping people on to the property ladder and, to that end, it has opened a consultation on a proposed new model for shared ownership.
The proposed new model is based on three main principles:
- making it easier for people to increase their share of the property, including allowing shared owners to buy equity in 1% increments
- making it easier for people to sell the home by giving shared owners more control over the sales process
- introducing a single preferred model that all providers, including for-profit providers, can confidently adopt. The idea is that this will grow the shared ownership market, enable lenders to provide more competitive mortgage finance and, ultimately, make it easier for customers to get a mortgage on the shared ownership basis.
The consultation recognises the key role that lenders, housing associations, local authorities and private investors will play in ensuring a new shared ownership model is successfully delivered. The paper seeks views on how the proposed model should be developed further and asks whether there are other changes that the Government should be considering to improve shared ownership, so that it becomes a tenure of choice for aspiring homeowners.