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Buyer verdict: shared ownership vs private renting

SHARED ownership buyers tell us they are better off and feel more secure than they did when they were renting from private landlords.

Their verdicts are revealed in our series of case study interviews and, according to Bromford Homes Head of Sales Alan Bradley, those views reflect the wider feedback from 200-plus customers who became shared ownership buyers last year.

Shared ownership's part-buy, part-rent formula offers couples, young families and other householders a truly affordable alternative to private renting, he says − and more people on lower working incomes could consider it as a way of getting onto the property ladder.

His advice to first-time buyers follows publication of a new Chartered Institute of Housing (CIH) survey that highlights the difficult plight for many private renters − and the screening of a BBC Panorama documentary that showed how easily tenants can be asked to leave their home at the end of a typical six-month lease.

More than a quarter of those living in the private rented sector told the CIH/Ipsos Mori that their home was too expensive − compared to an average of 10% − and the survey showed private renters are almost twice as likely to be unhappy with the state of their home.

"These findings confirm what many of our customers tell us about their negative experiences in the private rented sector as well as what we've been shown in a series of independent cost comparisons," says Alan.

Oaklands 960x400

"There are three main issues − affordability, a sense of security and the condition of people's homes. In each case, a new shared ownership home like those at Oaklands in Rugby (pictured above) is likely to offer a better alternative to private renting for anyone who can afford a typical deposit of say £3,000-£4,000*.

"Your new shared ownership home will be built to a high quality and it will come with all mod cons including a fully-fitted kitchen with hob and oven, fuel-efficient heating and double glazing − all of which will help to keep down fuel bills.

"Shared ownership is also a more secure form of tenure than private renting − and that's so important for young families with school-age children and local jobs, people who don't want to keep moving from home to home every six months or so at the whim of a private landlord.

"Last but not least, shared ownership is affordable. Crucially, for many first-time buyers, the deposits are low − just £3,364 if you buy 45% of a three-bed at somewhere like Colliers Green in north Warwickshire − and your TOTAL monthly housing costs are likely to be less than what you would pay for a similar home in the private rented sector."

Thomas Turner with keys

Alan cites recent independent cost comparisons published by HomeFocus magazine, the CIH and the National Housing Federation − all of which prove that shared ownership is typically cheaper. He also points to buyers like Thomas Turner at St Mark's View, Cheltenham, or Anna Malarska at Rugby's Oaklands − one of our most popular shared ownership developments in 2013-14, with a second phase now almost half-sold.

Thomas (pictured above) urges other young renters to give shared ownership a go, saying: "It's ideal for first-time buyers like me … overall, I know I pay less each month than friends in the Cheltenham area who rent apartments and, unlike me, they are not going to get anything back over time."

It's a similar story at Oaklands, where mum Anna (pictured below) moved into a two-bed home with son William last July. "Shared ownership is the perfect solution for first-time buyers like me who can't afford a big deposit or a big mortgage but want to get on the property ladder and invest in their future," she says. "We love our home and we love the area... and it's cheaper for me than the house I was renting before."

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Alan's parting message to other householders who want to follow in the footsteps of Anna and Thomas? "Call us now and find out how shared ownership could unlock your property dream," he says.

"We are not saying it's the answer for everyone − and the larger housing crisis will only be eased by building many more homes where people want to live − but affordability has always been the cornerstone of what we offer. As a potential buyer, you will, of course, need some savings and be able to prove to us − and your mortgage lender − that you can afford what is almost certainly the biggest single financial commitment you will ever make."

"We always work closely with all our customers to make sure that they only buy what they can afford and the success of the process can probably be best measured by what buyers like Anna and Thomas have to say about their experience."

To find out more about shared ownership and developments in YOUR area, call us on 0845 60 10 878 or register for updates. You can also keep up to date by following us on Twitter and Facebook.

* Example. At Oaklands, £78,750 buys 45% of a three-bed with a full market value of £175,000. Your minimum deposit would be £3,938, assuming a 95% mortgage on the share you buy.

25 June 2014