Administered by housing associations, shared ownership schemes aim to help buyers obtain a mortgage for a portion of the property while paying rent for the rest. Primarily geared towards first-timer buyers, these schemes offer a stepping stone onto the property ladder with a lighter financial load upfront.
To get on board with shared ownership, households must meet certain criteria, such as having a total income below £80,000 (£90,000 in London) and face the financial challenges of saving for a deposit and meeting monthly mortgage payments. While the concept of splitting the costs with the housing association seems fair, recent reports have flagged some major issues within the scheme.
Problems like rent hikes, unregulated service charges, surprise maintenance costs, and disproportionate repair bills have left many shared ownership homeowners feeling overwhelmed. In response to these gripes, the Levelling Up Housing and Communities (LUHC) committee is teaming up with affected homeowners to tackle the scheme's shortcomings and keep the Government accountable.
Proposed actions include ensuring that homeowners foot repair bills in line with their property share and pushing for reforms laid out in the Leasehold and Freehold Reform Bill. These reforms, like stretching leases by 990 years, are strides towards shaping a fairer and more transparent shared ownership scheme.
By rolling out actions to rein in rent spikes, proportionate service charges, and set guidelines for handling unforeseen maintenance expenses, the Government has a shot at turning shared ownership into a dependable route to wallet-friendly homeownership. With these changes, shared ownership can provide stability and peace of mind to homeowners, delivering on its pledge as a lifeline for those yearning to call a place their own.
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