It was disappointing, but unsurprising, that the Chancellor did little to change the status of Shared Ownership within the government’s housing policy. For many of the first time buyers, Shared Ownership is the only route onto the ladder.
Today’s first time buyers are paying almost a third more to get on the property ladder than they were five years ago, while the number of private renters moving into home ownership has fallen by nearly a quarter.
Some 83% of renters say rising rents make them more motivated to buy, yet three quarters do not believe they can afford a home on the open market without help from a scheme.
Shared Ownership should be the obvious answer. It bridges the gap between renting and full ownership for those who earn too much for social housing yet too little to buy outright.
BUILDING EQUITY
It helps people build equity, supports mixed communities and does so at a fraction of the cost of traditional subsidy. Yet it barely features in current policy documents and is all but invisible in the National Planning Policy Framework.
In my view, this Budget should have done these three things if Shared Ownership is to play its full part in the housebuilding programme.
Restore visibility and confidence in Shared Ownership
Help to Buy showed how a clear, well promoted scheme can support both demand and supply. Shared Ownership deserves the same treatment.
I would like to see a national communications and guidance campaign so that buyers, lenders, developers and local authorities all have a better grasp of how the product works, who it is for and how it can support delivery. That would cost far less than a new equity loan scheme yet could have a similar impact on confidence.
Unlock stalled schemes and support delivery
At present, too many affordable homes are tied up in Section 106 agreements that are becoming difficult to deliver, with many units even standing empty because registered providers are unable to take them on.
Targeted grant flexibility, clearer guidance on tenure cascades and the ability to use Homes England funding on section 106 Shared Ownership units would help schemes proceed, protect affordable output and support SME builders as well as larger housebuilders.
Update income thresholds to reflect real markets
The current income limits of £90,000 in London and £80,000 elsewhere have been frozen while prices have continued to rise. In many higher value areas, including much of the south east, even buying a 25% share of a modest home is now out of reach, yet some households earning just above the cap still cannot buy on the open market.
“Shared Ownership is not a substitute for social housing.”
A more flexible system that uprates thresholds and allows regional variation would keep Shared Ownership focused on those who need help most, without shutting out the “missing middle” of would be buyers.
Shared Ownership is not a substitute for social housing, nor is it a silver bullet for the housing crisis.
But for thousands of households it is the only practical step onto the ladder. My ask of the Chancellor is simple: recognise Shared Ownership as a central plank of the housing programme, give it the policy profile it deserves and make sure the rules allow it to work in the markets where it is needed most.
