NHF: Shared ownership - the only way onto the property ladder

Thursday, 24 May 2007 12:00 AM

Shared equity and part-buy, part-rent schemes will be the only way many of tomorrow's first time buyers will be able to afford a home, according to a group of housing experts meeting in Manchester today.

The National Housing Federation is calling for the government to invest more resources in flexible home ownership schemes to help people on salaries of around £25, 000 to £30,000.

Since 1997, house prices have risen by 139 per cent but earnings have risen less than 25 per cent and first-time buyers are increasingly making shared ownership their chosen route into home ownership.

The attractions of shared ownership are obvious: to buy an average value flat in England you will need an annual salary of £50,000. However a typical purchaser of a housing association flat on shared ownership earns about half of that.

Last year, (March 06-March 07) housing associations provided over 25,000 shared ownership or shared equity homes, up from 16, 000 the previous year.

Associations want the government to increase funding for affordable home ownership schemes that allow people to buy flexible shares to suit their individual purse. New schemes where people have to buy a 75% stake suit some, but not households on more moderate incomes. Whereas schemes that allow people to buy shares from 25% allow associations to help more people - last year the average income of purchasers of shared ownership properties was £26,500.

Speaking at the conference of Affordable Home Ownership Providers, Helen Williams, assistant director, National Housing Federation, said:
"To hope for a fall in house prices is unrealistic in the current housing market. Shared equity deals or part-buy, part rent schemes are the only possible way most low to moderate earners are going to get on to the property ladder.

"At the moment this type of ownership may be a niche market, but in the future it could well become the norm. The government needs to do more to help people on moderate incomes to access this type of home ownership product."

The Federation is also calling on Prime Minister in waiting Gordon Brown for a massive increase in investment in affordable home ownership and affordable rented accommodation to help those on housing waiting lists and the lowest incomes. At least 150,000 new affordable rented homes are needed over the next three years as part of the forthcoming Comprehensive Spending Review.

Ms Williams added:
"A good supply of affordable homes for rent and buy is crucial for a stable housing market and to meet the needs of people on lower incomes."

Notes to editors

The National Housing Federation represents 1400 independent, not-for-profit housing associations in England. Together, our members provide 2 million affordable homes for around 5 million people. www.housing.org.uk

iN business for neighbourhoods is a long-term project to improve the performance of housing associations and challenge negative perceptions of the sector and its customers. www.iNbiz.org

Affordable Home Ownership and Intermediate Housing Conference
Renaissance Hotel Manchester, 23 May 2007 - 24 May 2007
To view a full programme go to
http://www.housing.org.uk/library/viewfile.asp?fid=6409
To request a press pass please contact John Goulding or Joe Dumont on the numbers above.

House prices sourced from Land Registry. Shared ownership statitics sourced from CORE.
Last month the Council of Mortgage Lenders reported that the number of first-time buyers taking out mortgages has dropped for the first time in two years.

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