According to a new poll, young people in the UK seeking to buy their own home underuse or don’t understand the idea of shared ownership schemes.
The survey found that 18 to 24 year-olds are least aware of how shared ownership could increase their chances of getting onto the property ladder, despite being the main target market for the scheme.
Indeed, the YouGov national research, commissioned by Leeds Building Society, found that as many as three quarters of UK citizens know about shared ownership, but that 18 to 24 year olds are least likely to know about it – with just 40% expressing knowledge.
The news comes 40 years after shared ownership was first launched, and it has been discovered that awareness of the scheme increases with age, with 83% of those age 55 and over, 79% of 45 of 54 year olds, 78% of 35 to 44 year olds and 70% of 25 to 34 year olds aware of the scheme.
Additionally, of the 40% of 18 to 24 year olds who were aware of the initiative, only half of those revealed that they knew how it actually works.
The scheme was originally introduced in 1978 to create a middle ground between renting a property and buying, with the opportunity to purchase a share in a property and pay a rental fee on the difference. However, over a quarter of 18 to 24 year olds wrongly believe that shared ownership means buying a property with friends, family or a partner.
The research shows this misconception to be crucial, with 24% of youngsters saying they would be ‘very likely’ or ‘fairly likely’ to use the initiative in light of the new understanding of what it entails – the highest among any of the age groups surveyed.
‘Shared ownership as a method of purchasing has been around since the 1970s and offers a realistic way of getting onto the property ladder. It’s a proven formula that helps people secure a home, even where a traditional mortgage is not affordable, and its longevity is testament to its success,’ said Jaedon Green, director of product and distribution at Leeds Building Society.
‘The method is becoming increasingly popular for first time buyers as it reduces the need for a significant deposit, which can be difficult for some to manage. The scheme also permits first time buyers to combine it with a Lifetime ISA, maximising any deposit,’ he pointed out.
‘However, awareness still needs to be raised about the benefits of shared ownership, as it continues to be misunderstood and underused by many of the people the scheme was designed to help, particularly those aged 18 to 24,’ he explained.
‘The fact that almost a quarter of those aged 24 or under would be likely to use shared ownership once they found out how it worked shows the importance of increasing awareness and educating those who would benefit most from shared ownership,’ he added.