Affordable home ownership by the numbers
Shared ownership's low deposits and manageable monthly costs
are more important than ever for priced-out buyers, says our Head
of Sales ALAN BRADLEY, as the average first home price hits a new
NEW statistics highlight the true affordability of our shared ownership homes for
cash-strapped homehunters who are frustrated by rising property
The average price paid by first-time buyers is up by almost 14%
over the last year, says the latest report from the Office for
National Statistics, and that figure now stands at an eye-watering
Compare that with the average price paid by a Bromford shared
ownership customer − most of them first-time buyers. It's just
£83,131, or less than 40% of the national figure.
Then compare the latest statistics for typical first-time buyer
deposits. The overall average, according to another survey by the
National Housing Federation, is a whopping £30,000. That's roughly
the same or slightly more than a year's pre-tax wages for a typical
nurse, firefighter or plumber.
The average deposit for a Bromford shared ownership buyer? It
varies quite a lot because some of our homes are built in
high-price property areas like Solihull or Cirencester but, for
most of our first-time buyers across central England, the minimum
figure is somewhere between £3,000 and £5,000.
In fact, a minimum 5% deposit for someone paying the £83,131
average for a Bromford home like the one pictured above would be
just £4,157. That's a truly affordable amount for ordinary working
people who want to see their homeownership dream come true −
especially if they can't, like two-thirds of today's first-time
buyers, rely on help from the Bank of Mum & Dad.
It's this figure − the deposit − that really makes the
difference for aspiring homeowners. We know that because they tell
us so. That and the fact that shared ownership's unique part-buy,
part-rent formula enables them to commit to a mortgage that they
can actually afford whereas buying outright is simply beyond their
It's also worth saying here that total monthly payments for our
buyers − including low rent for the share that you don't
buy − are typically around the same or even less than you
would pay to rent a similar home from a private landlord. Surveys
confirm this and so do first-time buyers like Thomas (pictured
below) in Cheltenham, Anna in Rugby and Deborah in
Now private renting may well be the right option for, say, young
singletons who are often more mobile and may want to make the most
of that freedom to switch jobs and move to another town or a
different part of the country.
But our customers are priced out by open market property values
and most simply want the chance to stay in the village, town or
city where they've grown up, the place where their friends,
families and jobs are. Or they want the chance to put down those
roots so that they can start a family or make sure their children
can stay at the same school without having to worry about a private
landlord giving them notice to move on.
Our customers want the freedom to paint their walls with the
latest must-have colours, to entertain friends, make the most of
their gardens during the summer and enjoy the benefits of a
well-insulated, energy-efficient modern home in the depths of
Isn't that, after all, what a home of your own is really all
about? Somewhere cosy, secure and really liveable that won't break
Yes, homeownership is also generally regarded as a good
long-term investment. First-time buyers like Thomas, Anna (pictured
above) and Deborah all see it that way and tell us that they hope
to increase the share they own as and when they can afford it.
We, of course, support them in that ambition but the decision is
theirs and has to reflect their future financial circumstances. The
key word to remember then as well as now is affordable.
You can find out more about shared ownership and
developments in YOUR area by calling us on
0845 60 10 878. You can also register for updates or follow us
on Twitter and Facebook.
For more about the latest house price figures, read this
national newspaper report based on the ONS statistics or the NHF
Broken Market, Broken Dreams report.
19 September 2014