Kelly calls for wider home ownership

15 Feb 07
Council and housing association tenants should be encouraged to buy as little as 10% of their homes as a first step towards full ownership, social landlords were told this week.

16 February 2007

Council and housing association tenants should be encouraged to buy as little as 10% of their homes as a first step towards full ownership, social landlords were told this week.

Following the poor response to Social Homebuy from landlords and tenants, Communities and Local Government Secretary Ruth Kelly said it was time to stimulate the market by allowing tenants to purchase smaller shares.

Social Homebuy, which is available to just 5% of households who rent from a local authority or registered social landlord, requires them to purchase at least 25% of their home before buying the remainder on a step-by-step basis.

Speaking to the Fabian Society on February 13, Kelly said the government was still learning the lessons of Social Homebuy. 'We need to ask whether what we're offering is flexible and ambitious enough,' she said.

A review of social housing by Professor John Hills, due to be published next week, is expected to explore the boundaries between social renting and home ownership. During the past ten years, about 80,000 households have joined the property ladder through shared ownership schemes. By 2010, ministers hope this will treble to 240,000.

Calling for a major debate over a 'new right to own', Kelly said 1.7 million of the 4 million households who rent from councils or RSLs would prefer to be homeowners.

She said the aim was to bridge the divide between people who received help to buy property, such as deposits from their parents, and those who are increasingly priced out of the housing market.

Both the National Housing Federation and the housing charity Shelter said shared ownership should not come at the expense of more homes for rent. 'Significant investment in increasing the supply of new social housing must be the government's first priority,' said Shelter's chief executive Adam Sampson.

Alan Walter, chair of Defend Council Housing, accused the government of 'stigmatising public rented housing' by taking money from repairs budgets to subsidise home ownership.

Kelly also announced that local authorities will receive more than £430m in 2007/08 to improve private housing and fund regeneration schemes.

PFfeb2007

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