According to The Mortgage Lender (TML), the affordability constraints associated with homeownership means the part-buy, part-rent model of shared ownership makes it more attractive. 

Although 65% of respondents did not understand what shared ownership meant, once the concept was explained to them, 50% said they would consider this when buying their first home or had already done so. 

Of those who bought their first home in the last five years, 17% had a shared ownership property. Some 19% who were yet to buy considered the scheme, while just over 12% said they were likely to purchase a home using the scheme. 

 

Shared ownership making homeownership accessible 

When asked why shared ownership was a potential option, 26% said it enabled them to slowly build up to full ownership. Some 26% said they would not have been able to afford their desired home otherwise, while a quarter said they could get on the property ladder faster than expected. 

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A further 24% said the scheme made their monthly repayments cheaper than a full mortgage or renting. 

A fifth of respondents said shared ownership allowed them to afford to live where they wanted, a factor more prevalent in London, as indicated by a quarter of respondents in the capital. 

Some 19% said they would not have been able to get on the property ladder without shared ownership. 

Chris Kirby, head of sales at TML, said: “Affordability continues to be one of the biggest barriers for prospective buyers when it comes to getting onto the property ladder. As a result, it can mean many seek help elsewhere to raise the funds for purchasing a property, or otherwise make certain sacrifices, be it location or property type, to get on the ladder. Shared ownership, however, is a well-established option that optimises affordability and creates greater access to those looking to achieve homeownership status.

“It’s encouraging to see so many consider, or have taken up, this avenue to purchasing property as it gives many buyers the opportunity to get a foothold onto the ladder they otherwise may not have had. It also allows buyers to build their wealth creation when it suits them. Our own shared ownership proposition also looks to provide an even greater range of possibilities for customers with smaller deposits, be that by optimising affordability based on how we assess self-employed and complex incomes or by taking a more pragmatic approach to past credit issues.” 

TML launched into shared ownership lending earlier this year, with two- and five-year fixed rate deals up to 95% loan to value (LTV).