The housing shortage is at the forefront of public consciousness. Rising rents and capital values, within the context of fairly static wage growth, have left a huge cross-section of society with limited opportunities to own their own homes. With the affordability of housing for those even on above-average incomes now a national crisis, the recent shift in policy focus away from traditional ownership, has been broadly welcomed by the sector.
The effects of undersupply in the traditional ownership market are long-term issues, with huge implications for prospective buyers. It’s increasingly vital that new housing better meets the current needs on the ground and can help out those who otherwise would have to wait decades to buy.
For many areas of the UK, an increase in shared ownership stock is one part of the solution. It is a tried and tested tenure that has been used for 30 years. And the Government is beginning to recognise this, as evidenced by the references to the tenure in the white paper and the allocation of £1.4billion for affordable housing in last year’s Autumn Statement.
With the backing of senior MPs, including Sajid Javid, the sector now needs to demonstrate proactivity to show that it can be an effective partner to government in making shared ownership work.
CIH and Orbit, with support from Aster and the National Housing Group, assessed the state of the market in the Shared Ownership 2.1 report. The resulting charter, born of the report’s findings, aims to set a best practice standard for delivery across the sector.
It’s a flexible framework for housing associations that aims to better equip the sector with internal procedures that support a consistent customer experience in buying, owning and selling a shared ownership home. It’s also, crucially, a public commitment to champion and raise the profile of shared ownership homes and use clearer language to allow customers to make more informed decisions.
Led by outcomes rather than the processes, and with a long-term aim of driving self-created improvement in the sector, the standard will help strengthen the market for shared ownership by giving all housing associations a guide to best practice.
This should support the maturing mortgage market, which is becoming increasingly interested in the tenure. As lenders find that consumers are increasingly priced out of traditional routes, they are recognising a need to move towards shared ownership. In the past six months we’ve seen this with two new lenders, Atom Bank and Tipton & Coseley, launching products.
With more shared ownership stock, awareness of how the product works will naturally start to grow. We need to include shared ownership advertising on hoardings for new schemes and better communicate how the tenure, staircasing and resale work as well as creating more publicity when developments are being delivered.
Through the charter, and a resulting boost to shared ownership stock, the sector will also be in a better position to task the Government with promoting shared ownership with the kind of enthusiasm that helped make Help to Buy such a success.
The tenure has stood the test of time but its full potential hasn’t yet been realised. This is what the charter aims to do in putting best practice delivery of shared ownership at the heart of the solution to the housing crisis.