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Schemes intended to help low-income buyers onto the housing ladder are more likely to benefit the better off, according to a government report.
The Social Mobility Commission, an advisory body to the government, concluded that low-cost homeownership schemes are “unlikely to increase ownership among low-income groups”.
Drawing together various pieces of research, the commission noted that while the median household income of working families is around £30,000 annually, 80% of those benefiting from low-cost homeownership schemes earned more than that.
Because of the high cost of housing, most of these schemes are unable to help families on even average earnings, the report found.
For example, the median income of a household receiving a loan under Help to Buy was £41,323, compared to a nationwide median income of £39,834.
The costs of shared ownership are less than those of outright ownership first-time buyers, the report found, looking at analysis from the National Housing Federation.
It noted, however, various problems with the tenure, including the fact that the burden for repairs falls on the shared owner.
While recommending models that do not involve ownership, the report also encouraged greater targeting of low-cost homeownership schemes at lower-income households by, for example, restricting the income threshold for applicants.
A Department for Communities and Local Government spokesperson said: “This government is determined to make housing more affordable and we’re investing £7.1bn to build more affordable homes.
“We’ve already helped more than 400,000 households into homeownership through government-backed schemes since 2010, and the number of first-time buyers is at a nine-year annual high.”