Could we run out of Shared Ownership Housing?

‘We have been warned’, that was the message last week after affordable housing providers explained that developers are building fewer homes and even closing sites because of the problems facing them when it comes time to sell.

Developers have voiced their difficulty in selling houses in the present economic climate and said that in some cases they have been unable to meet legal requirements to build low-cost housing because they are not selling enough full-price homes.

These facts have come to light as house prices have fallen by nearly 4% in the last year, which is the most since 1993, but as mortgage rates increase.

Despite housing groups reporting a big demand for shared-ownership housing, the housing providers have said to brace for a low cost housing drought as developers reduce building rates to counter-act the fall in demand.

The Housing Association has explained that the builders are not to blame as they can only build houses at the rate that they are being sold, and with them not selling, they have had to slow down or close sites entirely. Despite the soar in demand for shared ownership homes, developers are, in many cases, not going to start building until there are improvements in the property market.

The soar in demand has been linked to 100% mortgages no longer being available to first time buyers, and FTBs opting for shared ownership schemes in a way of getting onto the property ladder. The demand for shared ownership doesn’t look to be waning and with this in mind, we could have more problems on our hands if we cannot meet this demand.