The new £1.4 billion fund to support affordable housing options is positive news and the flexibility should further incentivise housebuilders and housing associations to boost the number of units across different tenure types. It’s encouraging to see the Government recognising that affordable tenures need to play a key role in alleviating the UK’s housing crisis.
There’s a wide and diverse need for different housing types in the UK. The average age of someone buying through shared ownership is rising, suggesting that it is increasingly being used as a route to building equity by home seekers of a range of ages. A deposit can be less than £2,000 for a 25 per cent share of a £150,000 house, while deposits for conventional sale are increasingly unaffordable for many in the UK. It’s also, in most areas, cheaper than renting.
The demand-supply imbalance across the country is driving up house prices and interest rates are likely to rise in the next 18 months. It is clear that the previous focus solely on traditional ownership no longer works. Alternative tenure types must be seen as a positive and an innovative way of meeting the housing needs of a vast proportion of the country.
Both the Government and the sector will need to collaborate to make substantial, meaningful change when it comes to establishing a range of tenure options, including shared ownership, as mainstream choices.
By Amanda Williams, group development director at Aster Group.