Pepper Money has called on the Government to reform Shared Ownership after presenting its white paper at Downing Street.
Rob Barnard (pictured), intermediary relationship director at Pepper Money, handed the report to No.10, highlighting the importance of Shared Ownership in the current housing market.
Pepper Money’s research, ‘Shared Ownership – A Vital Bridge to the Housing Market’, found that Shared Ownership remains a key route onto the housing ladder.
The report came before the Government’s new Social and Affordable Homes Programme is set to launch in the autumn, with ministers confirming that Shared Ownership will continue as part of the UK’s affordable housing mix.
Pepper Money worked with Rob Thomas, former Bank of England economist, and David Gauke, former chief secretary to the treasury, to produce the white paper.
The paper included three main policy recommendations.
These aimed to make Shared Ownership more accessible, keep it financially sustainable and ensure it supports the government’s house building targets.
The first recommendation called for an independent body to collect and publish data on Shared Ownership, so policymakers have clear evidence on how the tenure is performing and where it needs to change.
The second proposal was to raise the household income cap each year in line with average earnings, moving up from the current £80,000 limit nationally and £90,000 in London.
The report found that the cap has not changed since 2016 and has fallen by 35% in real terms due to inflation.
If the threshold stays the same, it risks locking out people who need Shared Ownership the most.
The third recommendation was for a review of Homes England’s capital funding guide to standardise the approach for customers who don’t fit mainstream borrowing criteria.
Barnard said: “Shared ownership offers a vital bridge to the housing market for so many people who otherwise would struggle to buy their own home, but we know without action, this bridge will get harder to use for those who need it.
“Our policy recommendations are pragmatic, cost effective, and provide certainty for the sector to ensure that shared ownership continues to be the vital pathway to home ownership so many rely on.
“The Government has rightly outlined their ambition to build 1.5 million homes by the next election, and that can only be achieved by supporting a range of types of home ownership, including shared ownership.”
Barnard added: “The unintended consequence of the status quo is a less viable tenure, with shared ownership becoming less accessible for financially capable people seeking their own home and has the potential to undercut the Government’s own bold house building ambitions.
“At Pepper Money we see people achieving their housing dreams through shared ownership and we are committed to doing what we can to ensure this can continue.
“We’ve taken our message and our request directly to the heart of the Government, and into the hands of the Prime Minister’s team, and we urge them to act in the forthcoming Affordable Homes Programme to give certainty and a successful future to the tenure.”
He said: “We look forward to engaging with Government where possible to make the housing market more inclusive through financially responsible and sustainable methods.”
