Blog & Articles

Shared ownership can put a roof over the head of Generation Rent

Date: 22. November 2013
Vidhya Alakeson

With house prices out of reach for many, shared ownership could be the next big thing – but only if it makes some serious change.The gap between renting and owning with a conventional mortgage, even a high loan-to-value mortgage, has become unbridgeable for low and modest income families in some parts of the country, not just London.

Take Cambridge as an example. A couple with one child with a net income of £22,000 would have to spend 85% of their income on monthly mortgage payments if they had a 95% mortgage on a two-bedroom property. While the barriers to ownership are high, the aspiration to own remains strong, and there are good reasons to promote ownership, not least the fact that welfare spending on housing benefit and pensions will rise dramatically if large numbers enter retirement and still have to pay rent. Shared ownership can act as a bridge to home ownership for those on lower incomes, but to meet the needs of millions not a few hundred thousand, the product would need to change and be massively scaled up.

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Building homes for ‘generation rent’

Date: 14. October 2013
Vidhya Alakeson

The private rented sector is fast becoming the only housing option for low-to-middle-income families. Even with Help to Buy, home-ownership is too great a stretch for many, especially in expensive areas, and they are very unlikely to get access to affordable housing. We need to increase the supply of market rented homes as well as providing a different product that offers greater security, is more affordable and better managed to meet the needs of long-term tenants and the growing number of families with children who are making their home in the private rented sector.

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terraced housing

Homeownership: the preserve of the rich?

Date: 25. January 2012
Joe Coward and

This post originally appeared on Mortgage Solutions

One of the most striking findings of our Squeezed Britain report, which sets out the economic position of the squeezed middle in forensic detail, is that home ownership is now out of reach for many people on low to middle incomes (LMI).

On the basis of current incomes, house prices and the loan-to-value ratios now available, it would take a first-time buyer on a low to middle income 22 years to save for a deposit compared to three to five years in the 1980s and 1990s.

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Housing

‘Generation rent’ needs a helping hand

Date: 1. September 2011
Vidhya Alakeson and

This blog originally appeared on Public Finance

Yesterday’s report from the National Housing Federation predicted that by 2021 home ownership in Britain will have fallen to its lowest levels since the mid 1980s. 64 per cent of people will own a home compared to a peak of 73 percent ten years ago.

The government’s response to these predictions was half right. The minister for housing, Grant Shapps, talked about the need to build more homes. This would of course help address the chronic undersupply of housing, with the number of new homes being built at a post-war low. But it was also half wrong by continuing to focus exclusively on meeting people’s aspiration to own and ignoring the potential for the private rented sector.


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Housing

Making a Rented House a Home

Date: 8. August 2011
Vidhya Alakeson and

Published today, the Resolution Foundation’s Making a Rented House a Home outlines the shocking fact that the average low to middle income household buying a home today would have taken 31 years to save for a deposit , compared to 8 years in 1983. Last week a report by the estate agents, Savills, revealed that for the first time in Britain’s post-war history, more people are becoming tenants than home owners. We are witnessing a major transformation in our housing market that will see Britain become more like Germany and Switzerland where more than half the population rent rather than own a home.

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