Robert Jenrick, Secretary of State for Housing, Communities and Local Government, unveils plans for a new model of shared ownership designed to get more people onto the housing ladder.
A package of measures to help people on lower incomes get onto the housing ladder has been unveiled by Housing Secretary Robert Jenrick.
The Government will review a new national model for shared ownership to make it easier for people to buy more of their own home, including allowing them to buy in 1% increments. This step will help to fulfil the Prime Minister’s priority to level up the whole country, closing the opportunity gap and helping millions of young people into home ownership.
At present, they have to buy an increased share in 10% chunks, which can be as much as £45,000 per time. This process of increasing the stake until the property is bought outright is known as ‘staircasing’.
People use shared ownership to buy a proportion of their home — which can be as little as 25% — and then pay a subsidised rent on the rest.
Housing Secretary Rt Hon Robert Jenrick MP said: “Building the houses this country needs is a central priority of this government. We know that most people still want to own their own home, but for many the dream seems a remote one.
“My mission is to increase the number of homes that are being delivered and to get more young people and families onto the housing ladder, particularly those on lower incomes.
“That’s why I am announcing radical changes to shared ownership so we can make it simpler and easier for tens of thousands trying to buy their own home.
Help to Buy, the cut to Stamp Duty and our home-building programmes are already making a real difference, but I am clear we need to go much further if we are to make the housing market work.
“I will be looking at ensuring young people from Cornwall to Cumbria aren’t priced out of their home areas and how we can build public support for more house building and better planning.
“This government will help a new generation to own their home.”
The Housing Secretary also announced he will look to reform the planning system to increase housing delivery and make home ownership more affordable for people looking to buy their first property, particularly in areas which are least affordable.
This could include increasing the number of homes sold at discounted prices to people trying to get onto the property ladder, boosting homeownership and helping build local support for new development.
National housing debate
Amy Nettleton, of housing association Aster Group, which has 2,489 shared ownership homes in its portfolio, said: “For many years, the housing sector has called for shared ownership to receive more attention from ministers as a potential solution for those trapped in insecure rent but unable to buy outright, so we should certainly welcome this consultation and its ambition to improve the product.
“Even those of us who believe passionately in shared ownership understand it’s not perfect and we should explore ways of improving it, such as simplifying the staircasing process. We know from our own research that a lack of awareness and misunderstanding are also holding it back, so focusing attention on how shared ownership works and who can benefit, will be just as important as adjustments to the model itself.
“It’s heartening to see the Government recognise shared ownership’s place in the national housing debate. We stand ready to do what we can to support the consultation.”
Home ownership stance
Peter Hogg, UK Cities Director at Arcadis, commented: “Robert Jenrick today confirmed early hints about this Administration’s policy direction on housing; it’s all about home ownership. Directly referencing the policies of Margaret Thatcher — and the ideology behind them — was a clear appeal to the Tory heartland, with his own credentials as a self-avowed millennial bringing the draw of home ownership bang up-to-date.
“Whilst policy detail is currently thin on the ground, plans to reduce shared ownership equity increase increments and fees and administration in acquiring them are logical, workable and to be welcomed. As ever, the devil will be in the detail and proposals must work for the developer and registered provider too, in order to ensure that the policy doesn’t exacerbate the very problem it seeks to solve.
“Perhaps more intriguing are Mr Jenrick’s teasers on future policy towards brownfield land, residential development in town centres and planning reform. This hints at a far more radical shake up of housing delivery. Exciting as these opportunities may be, there are good reasons why these nettles have not been fully grasped before. We look forward to seeing Mr Jenrick and his team engage thoroughly to deliver the right policies, rather than just the crowd pleasing ones.”