A leading West Midlands new homes provider is expecting further rises in the popularity of Shared Ownership, with buyers looking for realistic and affordable routes onto the property ladder as the UK economy enters another period of uncertainty.

Shared Ownership gives first-time buyers and those who do not currently own a property the opportunity to secure a new build home. Homebuyers pay a mortgage on the share they own and pay rent on the remaining share, meaning only a smaller deposit is required.

The scheme has existed since the 1980s, and in total there are currently more than 202,000 homeowners in England living in Shared Ownership properties, which is around one per cent of those with their own home.

With its extensive expertise from 60 years of working towards making homeownership achievable for everybody, Bromford predicts that more homebuyers will consider Shared Ownership as their preferred route onto the property ladder than ever.

Owing to increased demand for an affordable pathway to homeownership across its operating regions, Bromford recently launched a new website (www.bromfordhomes.co.uk), helping to make Shared Ownership more accessible and digestible for a variety of home seekers.

Bromford's homes are available for local people to purchase with a 25 to 75 per cent share value, with some available to purchase for as little as 10 per cent. Once in the property, buyers have the option to increase the amount of shares they own, in a process called 'staircasing'.

The greater the share, the less rent buyers will pay. The end goal is to gradually increase the owned share until 100 per cent of the home is owned, when buyers become the outright homeowner and no longer pay rent at all.

In 2023/24, of the 101 customers that staircased in their homes, 80 staircased to 100 per cent ownership – just over 79 per cent.

Bromford expects the figure of those who staircase to total ownership to continue rise over the next few years, as more and more property seekers turn to Shared Ownership. While interest rates fell from 5.25 per cent to 5 per cent recently, buying a home on a full mortgage is no longer financially possible for many.

First-time buyers are particularly finding it difficult to save for a deposit, while the idea of being able to afford a 100 per cent mortgage alongside the costs of running a home is simply unfeasible in a lot of cases. This, combined with the government-backed Help to Buy scheme coming to an end and parents being less able to set aside money for their children's deposits, means Shared Ownership will likely continue to become the solution.

A report from Savills, published in June 2024, states the average first-time-buyer uses a deposit of 24%, equivalent to £71,000 for a £300,000 home. Those using Shared Ownership have an average deposit of just 7%, or £22,200.

Catherine Jarrett, Director of Sales and Marketing at Bromford, said: “Shared Ownership has played a crucial role in offering a lifeline for first-time buyers and other homeseekers to get onto the property ladder since the pandemic and the economic crises from 2022 onwards.

“We expect demand to further increase with more education around Shared Ownership and Staircasing, with more buyers learning more about how the scheme can help propel them onto the property ladder earlier than expected. 

“It's essential for shared owners to understand that they're not confined to permanent sharing and that it's not necessarily a long-term tenure, with Staircasing providing the perfect opportunity to own their own home outright as long as their lease allows. The more awareness there is around the process being a stepping stone for those who cannot immediately buy outright, the more we expect an uptick in buy-in to the scheme.”

Bromford is providing a range of Shared Ownership homes for local people throughout the West Midlands. To find out more, visit https://findahome.bromford.co.uk/.  

https://pdf.euro.savills.co.uk/uk/residential---other/spotlight---shared-ownership---2024.pdf.

-ENDS-

NOTES TO EDITORS:

Bromford is one of the largest housing associations (HA) in the country. Providing both open-market property and affordable homes for people who are unable to access market housing, the HA owns more than 45,000 homes spread across Central and South West England.

For further information or for PR enquiries about Bromford Shared Ownership, please contact Ethan Henson on 0116 247 1777 or ethanh@unsworthsugden.co.uk.