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Too many affordable homeownership products unsettle consumers – New Homes Mortgage Senate

  • 20/10/2023
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Too many affordable homeownership products unsettle consumers – New Homes Mortgage Senate
Lenders should tweak their policies to improve access to affordable homeownership schemes, rather than wait for new initiatives to be launched, it was said at the British New Homes Mortgage Senate.

Speaking on a panel at the event last week, Amy Nettleton, assistant director of development – sales and marketing at Aster Group, said the industry should not “awash” the market with new schemes. 

Nettleton said: “When we start to add different products it unsettles the market… it unsettles the consumer because they don’t understand it. Shared ownership is in its 43rd year now, I’ve been working on it for the past decade and a bit, and we still get the challenge where people don’t understand it.  

The new models of shared ownership have enhanced the product, bringing some additional complexity, Nettleton added.

Last year, changes were brought in to reduce the minimum initial share for a shared ownership purchase from 25 per cent to 10 per cent. Shared owners can also purchase shares in one per cent increments rather than multiples of five or 10 per cent. 

Nettleton said the ability to buy shares below 25 per cent opened access to buyers in areas where properties had a higher value. 

When asked if more product offerings were needed for affordable homeownership purposes, Nettleton said the sector should “be careful what we wish for”. 

“Affordable homeownership for lenders is a small part of their lending portfolio,” Nettleton said, adding that if this was “sliced and diced” further it would impact the flexibility of products as well as the appetite and capability of lenders. 


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She said looking at the attention given to different affordable homeownership products, “shared ownership has remained a constant for decades”. 

“It has been compared to Help to Buy, however, the two products were marketed and supported very differently,” Nettleton added.  

She said while an array of affordable homeownership schemes had entered and left the market over the years, shared ownership has remained a robust offering for over 40 years through all of these changes. Nettleton said: “We are now seeing the impact of the closure of such high profile schemes with the reported repayment struggles faced by Help to Buy owners.” 

She added: “I do think shared ownership is a very standard, easy product that equally lenders are comfortable with and providers are comfortable with.” 

She said providers were “committed to this space” particularly now that they were no longer wholly reliant on Section 106 agreements for delivery. 

Nettleton said lenders should not bring in loads of new affordable homeownership products, but “look at your lending criteria” and make it easier for customers to port to a standard mortgage and staircase. 

“All of those things are where the actual product development needs to be,” she said. 

Andy Mason, head of housing and sustainably at Lloyds Banking Group, said there were problems with accessing affordable and good quality housing across the social, private rental and owner occupied sectors. 

He said the sector needed to think more innovatively about getting people onto the first step of the property ladder. 

“Undoubtedly lenders have got to be a bit more creative. Shared ownership for example, which has been there for a number of years, if we can’t get good lender participation in supportive schemes around what is now the core affordable housing scheme and get our heads around that as a market,” he added. 

He said more could be done to help both lenders and consumers understand shared ownership, adding that there needed to be more transparency with the data available to answer lender questions and increase participation. 

“This is decent quality lending. As a bank, we lend 95 per cent of the share of shared ownership, because we’ve got a lot of experience and the experience is good,” Mason added. 

He said shared ownership could help people who felt stuck in the rental market and take them into full homeownership in the future. 

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