The Council of Mortgage Lenders (CML) has called for tenants living in social housing to be allowed to buy a share of equity in their home.
Following a review of shared ownership schemes, the trade body concluded that shared ownership does spread the benefits of owning property, while improving the status of social housing. However, it was decided that further debate into how equity stakes should fit in with the existing right-to-buy process is needed, if shared ownership is to keep evolving.
Michael Coogan, director general of the CML, said: ‘Shared ownership could potentially make a significant contribution to the growth of home ownership in Britain. Although the Government’s starter home initiative provides help for certain types of public sector employee in areas where house prices have risen sharply, a thriving economy requires housing for key workers of all kinds. Shared ownership could help spread some of the benefits of owner occupation to a wider range of lower paid people.’
But, John Mawdsley, director of The Mortgage Partnership, is not convinced by the idea. He said: ‘Right to buy can give up to a 60% discount. Even for less well established tenants, the discounts are so generous, I’m not sure there would be the demand. One can only assume the CML has thought about this and has a good argument.’