The barriers to shared ownership assessed

The Levelling Up, Housing, and Communities Committee has initiated an investigation into shared ownership. This inquiry aims to assess whether shared ownership provides an affordable path to homeownership in reality. The goal is also to identify the obstacles preventing individuals from achieving complete homeownership. The committee is seeking responses to various questions outlined in their request for evidence.

Over the years, shared ownership has encountered numerous difficulties, leaving many participants distressed due to the complex procedures and limited choices available within the program. The inquiry will focus on identifying the obstacles hindering people from attaining complete homeownership and assessing whether shared ownership offers an affordable path to homeownership.

The challenges of reselling shared ownership properties explored

It will also look at the challenges related to reselling properties, affordability concerns such as service charges and maintenance responsibilities, and issues surrounding the availability of mortgages and the limited number of providers in this space. With a deadline of September 14, the committee is actively seeking insights and responses to several critical questions.

Shared Ownership and Right to Shared Ownership uncovered

One of the primary concerns under scrutiny is whether schemes like Shared Ownership and Right to Shared Ownership truly offer good value for potential homeowners. Some argue that shared ownership can make the already complex leasehold purchase even more convoluted. This often leads to disadvantages for purchasers, not only as leaseholders but also as Assured Short Hold Tenancy (AST) tenants for the portion of the property they do not own. In some cases, the lease terms are stacked against them from the start.

Shared Ownership and affordability amidst the cost of living crisis

The inquiry by The Levelling Up, Housing and Communities Committee also delves into the challenge of keeping Shared Ownership and Right to Shared Ownership affordable in the face of increasing provider costs and inflation. While these schemes aim to make homeownership accessible, they introduce yet another intricate contract into the housing market. Additionally, they can create a financially appealing income stream for investors, as shared owners are inclined to resist losing their properties and continue paying rent for the portion they do not own.

Is Support and Regulation needed in the Shared Ownership market?

The impact of leasehold properties on Shared Ownership tenants is another aspect under scrutiny. The inquiry will evaluate how changing sector regulations might influence these schemes and their participants. Questions are raised about the availability of mortgage providers for Shared Ownership properties and the challenges related to repair costs.

Moving from Shared Ownership to Full Ownership

The practicality of achieving full ownership through Shared Ownership and Right to Shared Ownership is also being examined by The Levelling Up, Housing and Communities Committee. The question is: in its current form, does the Right to Shared Ownership policy reduce homeownership risks for individuals from lower income backgrounds? The committee seeks to identify ways to secure Shared Ownership as an affordable path to homeownership and understand how varying costs from different providers affect tenants and potential buyers.

Shared Ownership Data Collection and Alternatives

Improving data collection regarding Shared Ownership and the Right to Shared Ownership is on the committee's radar. They are considering alternative schemes like 'Rent to Buy' and whether these alternatives offer better value for money.

Shared Ownership should support First-Time Buyers

Finally, the Levelling Up, Housing, and Communities Committee is exploring what more can be done to support first-time buyers and individuals with lower incomes in their journey onto the property ladder.

The Communities Select Committee's inquiry into shared ownership is a crucial step towards addressing the complexities and challenges associated with these schemes. It reflects a commitment to ensuring homeownership remains accessible and affordable for many individuals while deliberating the impact on leaseholders and the broader housing market.