Your First Home could make a valuable difference to people who can manage mortgage repayments but cannot accumulate a deposit while paying rent. The Budget should turn that ambition into a workable scheme – but, importantly, while recognising that Shared Ownership remains just as important as ever.
The Government’s announcements to date make it clear that Your First Home will be subject to household income and local property price caps, and available for new homes from participating developers. Its reach will therefore depend on eligibility, the homes available and how quickly the scheme becomes operational. It cannot meet every aspiring homeowner’s needs.
At SOWN, we have consistently experienced considerable demand for Shared Ownership and expect this to continue. Some buyers will not qualify for Your First Home. Others will qualify but find that the available properties do not suit their location, household or budget. So to provide much-needed help for first time buyers, the Budget should support a choice of routes into ownership and maintain investment in Shared Ownership alongside the new initiative.
Shared Ownership also offers something that Your First Home does not: access to existing homes through resales. These are properties already within Shared Ownership whose owners are selling their share. This substantially broadens the choice of homes and neighbourhoods buyers can consider, including established communities where new development may be limited. As such, it deserves much greater recognition in the Government’s promotion of home ownership.
There is also a middle ground that eligibility rules must address. It has already been identified that many households, including those comprising of two key workers, can earn too much to qualify for Your First Home while still being unable to afford a suitable home. But a reasonable salary does not necessarily come with savings or family wealth.
Now more than ever, Shared Ownership, needs a similar status and level of communication as Your First Home is already receiving. A recognisable national brand and coordinated promotion would help buyers understand its availability, eligibility and costs, alongside responsibilities for repairs and the processes for buying further shares or selling, and importantly, help buyers chose the option best suited to them.
Our wish is for a Budget that supports first time buyers by giving them options. Your First Home should add to the routes available, with Shared Ownership continuing to receive the funding, recognition and policy attention that is warranted by sustained demand.
