Shared Ownership: achievable, affordable and for everyone
Kevin Sims, Director of SO Resi, says: Shared Ownership: achievable, affordable and for everyone
Culturally, we have a strong affinity for homeownership.
Purchasing a home is seen as a natural ‘life milestone’ akin to marriage or starting a family. Worryingly, shocks to the property market and the economy in recent years have made it harder for future first time buyers to get onto the property ladder. In fact, new data reveals that first time buyers made up the lowest proportion of mortgage searches this year, equating to just 16% of all buyers seeking a mortgage.
But the tide is turning. Help is out there for struggling first time buyers who want to own their own home, but aren’t sure whether they can afford it. With more than a quarter of a million shared ownership homes already built in England, this scheme is a vital solution to the crisis of affordability that would-be homeowners are facing.
Shared ownership allows buyers to purchase a percentage share of a new home, typically between 25%-75%, but sometimes as low as 10%. They would typically secure a mortgage on the part that they own, while paying a below-market-rate rent on the remaining percentage. This means that lower-income buyers who might struggle to borrow enough to secure an adequate mortgage can purchase a home that previously would have been out of reach.
In fact, new research reveals that the average household income for a shared ownership buyer is £32,200 – just below the average UK salary of £35,880. Shared ownership was created to help average earners at a time when salaries just cannot keep up with house prices.
For renters, low earners, and anyone struggling to save, buying a home with shared ownership doesn’t require a huge deposit. In fact, using shared ownership can also cut down the size of your deposit, as it only requires buyers to put down a deposit as low 5% of the share that they are buying.
This means that for a property worth £300,000, in order to purchase a 25% share (worth £75,000) a buyer would only need to put down a 5% deposit of just £3,750. This figure is magnitudes smaller compared to purchasing a home outright.
There is a misconception that shared ownership is a scheme for Londoners and people living in cities. However, this could not be further from the truth. People everywhere struggle to afford their own home, and the spread of shared ownership homes reflects this growing need – in fact, 77% of all new shared ownership homes are built outside of London. Furthermore, data from Homes England indicates that nearly three quarters of these shared ownership homes are houses or bungalows – though of course there are plenty of apartments available too.
Shared ownership is a crucial component of the engine that drives the housing market. Without it, thousands of first time buyers would not have had the opportunity to buy their first home. To find out if shared ownership could be the right solution for you, then please visit www.sharedownership.co.uk
SO Resi has a number of developments available with shared ownership, but within and outside of London.
SO Resi Whetstone
A selection of apartments located in North London, our SO Resi Whetsone development offers balconies and terraces to each apartment, while every home has access to a central courtyard with seating and plenty of space to socialise or unwind. A number of shops, restaurants, and Totteridge & Whetstone Tube Station are all within walking distance.
Prices start from £100,000 for a 25% share of a one-bedroom apartment (full market value £400,000), which can be secured with a five per cent deposit of just £5,000.
SO Resi Oxshott
Just a handful of homes remain at SO Resi Oxshott, set in one of Surrey’s most sought-after locations. The development is surrounded by the woodlands and parkland of Princes Coverts, a paradise for walkers, runners and cyclists.
Prices start from £106,875 for a 25% share of a two-bedroom apartment (full market value is £427,500).
Link for sales: https://soresi.co.uk/find-a-property/so-resi-oxshott
SO Resi Hendon Waterside
Forming part of the wider Hendon Waterside development, this collection of shared ownership homes is situated next to the scenic Welsh Harp reservoir, a Site of Special Scientific Interest, where residents can enjoy exploring the surrounding woods, trails and footpaths. Available here is 42 studio, one and two bedroom apartments, and two and three-bedroom duplex homes. Prices start from £84,375 (5% deposits from £4,219)