We’ve always believed that the property industry can do more to help people on the road to homeownership. With the cost of living and interest rates on the rise, home ownership may seem unachievable for many.
By providing affordable ways to buy a new home, boroughs can help address this imbalance and also look forward to retaining skilled labour, enabling people to stay in their local communities. This approach supports economic growth as an alternative to displacing jobs and skills when people are priced out of their local markets and forced to seek out cheaper areas to live.
Shared Ownership is a form of intermediate tenure affordable housing designed to help those wanting to gain access to the property ladder by purchasing a share of a new home, while renting the remaining percentage. It is then possible to purchase further shares in the home when in a position to do so, which is known as ‘staircasing’. Shared Ownership has been designed to help people stuck in the ‘rent-buy gap’ to fulfil their aspirations of full home ownership in more affordable and manageable stages, with the backing of established housing associations.
A recent study conducted by SO Resi, found that only a fifth of under 30s are aware of affordable housing options, prompting industry experts to call for improved financial education. The research focuses on the status of Shared Ownership in England and identified that some 70% of those surveyed said they would prefer to own their own home, but despite this significant interest, two thirds reported knowing nothing about the process of buying a house. Interestingly interest in schemes such as Shared Ownership jumped by as much as 50% once it was explained to 18-30 year olds.
The significance of Shared Ownership as a genuinely affordable tenure was recently thrust into the limelight as part of a landmark appeal decision made by the Planning Inspectorate. The scheme in question, located in the London Borough of Ealing, proposed 94 Shared Ownership flats and was supported by the Borough’s planning officers. However, it was rejected by Ealing’s Planning Committee, in part due to there being a lack of affordable rented tenures on offer within the scheme. Overturning the refusal, the Planning Inspector acknowledged that, “the evidence shows there are tens of thousands of Ealing Households in need of intermediate tenure affordable housing. There is no provision in local or national policy or guidance that justifies ranking one form of affordable housing need over another.”
Local Planning Authorities can go further to support demand by objectively assessing affordable tenure needs, moving from a default position of pointing developers to social rented units.
We welcome the research by SO Resi which highlights interest in affordable options, and look forward to working with London boroughs to ensure that Shared Ownership is part of the offer for retaining and developing communities.
*Research insights via https://soresi.co.uk/
