New way up housing ladder through shared ownership
Recent research has indicated that shared ownership is one of the main ways of getting on to the housing ladder.
Released by Orbit and the Chartered Institute of Housing, the report – Shared Ownership 2.1- focuses on the development of shared ownership, which provides prospective buyers with the opportunity to purchase a part of their home and pay rent on the remainder. On average, the age of a shared owner is 33, who is likely to be receiving an average income of £33,558.
As around 34% of adults surveyed stated that they knew about shared ownership, it ranked as one of the top ways of getting onto the housing ladder. This figure can be compared to the 32% who knew about right to buy, and the 28% who knew about the help to buy equity loan who responded to the Ipsos MORI poll. Only 18% of those asked had not heard of shared ownership at all.
The report shows that across the majority of the UK, tenure is affordable and thus largely over-subscribed. During 2016, for the 8,000 shared ownership homes available, 85,000 applications were made. There is, however, as indicated by the report, capacity to build many more homes.
Two years prior to the most recent study being conducted, the original shared ownership research encouraged governmental investment in constructing more homes for tenure. With an aim to build 135,000 new shared ownership homes, £4.1 billion worth of funding has since been set aside, with the eligibility criteria having been relaxed. Since 2001, 102,848 shared ownership homes have been built, with 54,000 being managed by housing associations.
Commenting on the report was Gavin Smart. The deputy chief executive of the Chartered Institute of Housing highlighted the growing popularity of shared ownership as well as its necessity in the current market.
“What this report shows is that shared ownership is now a popular and affordable route for many people in the UK to get a home.
“As house prices continue to rise, shared ownership is an option for the growing group of people for whom home ownership is increasingly out of reach, but who don’t have the level of need to qualify for social housing.
“It is pleasing to see more government funding being diverted towards shared ownership as this report makes it clear we need many more homes to cater for growing demand.”
The executive director of futures at Orbit, Boris Worrall also commented on the research: “This research shows that shared ownership is gaining real momentum as a popular and well-known route into home ownership for thousands of people who would otherwise be priced out of the market.
“Government support and the sector’s ambition, alongside better marketing and management, indicate an even brighter future for this affordable and aspirational product.”