A poll has suggested a lack of knowledge about the UK Government’s shared ownership scheme
A shared ownership scheme was launched by the British Government five years ago with the aim of helping more people onto the property ladder but new research suggests there is a lack of knowledge about it.
The survey report from credit experts TotallyMoney questions if it is indeed a viable way to help those who want to get their foot on the housing ladder.
It found that there is a high level of confusion surrounding the scheme, particularly amongst 18 to 24 year olds, the very group it was designed to help, with just 18% knowing what the shared ownership scheme is.
It also says that only 19% of property buyers in the last 10 years have used a Government buying scheme to secure their property, with a smaller 6% having used the Government’s shared ownership scheme.
And some 80% of first time buyers who purchased through the Government’s shared ownership scheme didn’t know what ‘leasehold’ meant.
Amongst those surveyed, the results revealed that the British public’s lack of knowledge on the shared ownership scheme is deterring them from using it to their benefit.
In addition, once presented with the correct definition of the Shared Ownership scheme, 38% of first time buyers would still not consider buying through the shared ownership scheme. When questioned as to why this was the case, 35% stated that fear over hidden additional fees would deter them from utilising the scheme.
Under the scheme first time buyers, people who used to own their home but can no longer afford to do and existing shared owners can buy a home under the scheme through Housing Associations.
They qualify if their household earns £80,000 a year or less, or £90,000 a year or less in London, and once they become an owner they can buy more shares, known as ‘stair casing’.
The cost of a new share will depend on how much the home is worth when one wants to buy the share. It will cost more than the first share if property prices in the area have gone up and less than the first share if property prices in the area have gone down.
The housing association will get the property valued and inform the cost of the new share. One will have to pay the valuer’s fee.
When it comes to selling, if a person owns a share of the home, the Housing Association has the right to buy it first. This is known as ‘first refusal’. The Housing Association also has the right to find a buyer for the home but if a person owns 100% of the home, then the owner can sell it on own.