Two-thirds of first-time buyers do not understand what shared ownership is or how it can help them get on the housing ladder.
According to a survey by TML, gaps in first-time buyers’ knowledge about shared ownership, which is an affordable housing scheme, could be preventing them from getting on to the property ladder.
Crossed wires
Who you are sharing the ownership of your home with caused the greatest confusion among buyers.
Some 17% of first-time buyers thought that shared ownership meant co-owning with your family. A further 14% said that shared ownership meant sharing responsibility of being a landlord on a property. Another 8% believed it meant owning with a stranger, and a further 7% identified it as owning with a friend.
Some 14% said they didn’t understand shared ownership at all, and another 5% said it meant owning a few rooms in a house.
With 65% either defining shared ownership incorrectly or being unable to do so at all, first-time buyers could be missing out on the opportunity of homeownership, says TML.
Affordability challenges
Research from the Building Societies Association found that, over the last 70 years, it has never been a more expensive time to be a first-time buyer than now.
Affordability challenges, high house prices and the rising cost of living have left first-time buyers with significant barriers to getting on the ladder. The association has called for radical support from the government to support first-time buyers.
Louise Apollonio, head of corporate accounts at TML, said: “The first hurdle to get onto the ladder is raising a deposit, which is particularly difficult for those renting who are also dealing with steep rental price rises. However, that doesn’t mean that they wouldn’t be good candidates for owning a property. Shared ownership provides an opportunity for first-time buyers to get a step on to the ladder without the need for a huge deposit, allowing them to slowly work up to total ownership of the property.
“We believe that everyone deserves a place that they call home, and are committed to ensuring that our lending practices support our end customers’ real-life situations.”
Samantha Partington is a freelance trade and consumer journalist writing about property and personal finance. Previously she worked worked for the Daily Mail and Property Week. She is the former deputy editor of Mortgage Solutions and editor of Specialist Lending Solutions.
Before becoming a journalist, Samantha worked as a mortgage broker and latterly for a mortgage, bridging and secured loan lender. Samantha is CeMAP qualified. Follow her on Twitter @SamJPartington1.
