Affordable home ownership after the crisis: England as a demonstration project
International Journal of Housing Markets and Analysis
ISSN: 1753-8270
Article publication date: 4 October 2011
Abstract
Purpose
The purpose of this paper is to explore the role of affordable home ownership in the light of the recent global financial crisis.
Design/methodology/approach
The paper draws on recent research conducted by the authors and others which included analysis of secondary data and policy documents and interviews with key stakeholders including housing associations and developers. The theoretical scope of the paper is outlined in the first section which looks at the principles behind the two main approaches to providing affordable home ownership: shared equity and shared ownership. Given continuing aspirations on the part of most households in England to become home owners, the key comparison is with the attributes of full ownership.
Findings
The paper finds that the main products share many of the attributes of full home ownership while remaining more affordable. The economic situation post‐2007 made both shared ownership and shared equity more difficult. The crisis and its aftermath also suggest that there is a need to develop a more robust and longer term market in equity sharing. This could be of real significance into the longer term, especially if the availability of mortgage finance remains constrained for many years to come. The paper concludes that in the longer term, developing a range of partial tenures which provide most of the benefits of owner‐occupation but which reduce risks to individual households and improve affordability in the early years is a desirable strategy.
Practical implications
There are clear implications for policy makers in other countries, notably the benefits from developing an intermediate tenure market which includes institutional equity and risk taking rather than continued large‐scale reliance on debt finance.
Originality/value
Given stated governmental ambitions to meet housing aspirations, this paper clarifies how it is possible to meet an identified need for affordable home ownership products to fill the growing “gap” between first‐time buyers who can purchase with parental help and those who have no means of achieving home ownership, even though they have the income to support such a choice.
Keywords
Citation
Whitehead, C. and Monk, S. (2011), "Affordable home ownership after the crisis: England as a demonstration project", International Journal of Housing Markets and Analysis, Vol. 4 No. 4, pp. 326-340. https://doi.org/10.1108/17538271111172139
Publisher
:Emerald Group Publishing Limited
Copyright © 2011, Emerald Group Publishing Limited