Read on Twitter
I woke up incensed by the Minister's tweet this morning, and fired off a couple of quick tweets. Here's a slightly more reflective consideration of the Minister's fandom and view that shared ownership "works for many" 1/of many (sorry) https://twitter.com/team_greenhalgh/status/1332076094258884608
On Shared ownership "works for many" - this is an empirical question, of course, but one that goes beyond mere "satisfaction" surveys. One can be satisfied with one's home but dissatisfied with other aspects ... 2/of many (not sorry)
For example, you can love your home and the idea of shared ownership but have issues with "owning" (say) 25% but be responsible for 100% of service charges, repairs etc. Try telling trapped leaseholders that it "works for many". 3/of many
The point is that it may work for at least some at certain points, but this is a long lease, and the rent is on an accumulator (ie RPI+), and over time problems emerge. And those problems demonstrate the inherent fragility in the model.
Many commentators on here have said, rightly, that shared ownership demonstrates the problems of the leasehold model. It does. And it magnifies them. But, it should be pointed out that most leaseholders don't have such a skewed lease, ... 5/of many
and SO is targeted at those who can't otherwise afford to purchase on the open market. These problems have been known since the foundation of shared ownership (see John Stanley MP's pamphlet in 1974). 6/of many
Nobody has done more research on shared ownership as a model than @alisonwyork. Alison's measured, brilliant response (based, in part, on our joint work) to @Datshiane's outstanding @BBCPanorama show needs to be read by the Minister. 7/of many
What it demonstrates is that the model of shared ownership is, as I said, fundamentally flawed. The idea may be good but it is not a foot on the ladder, and it is neither "shared" nor "ownership". That must be obvious by now 8/of many
Indeed, I can't believe that I'm still having to write that. The name "shared ownership" came from John Stanley, originally shared purchase, and it was designed at a completely different time to meet different issues in the market. 9/of many
John Stanley was, and is when I spoke to him, a passionate adherent to shared ownership, but even he recognised the fragility and problems in the model. The lease was used so that the idea could be franked and replicated. 10/of many
The label "shared ownership" was coined as a marketing tool - for all this and more, see the publications tweeted yesterday by myself (written with @alisonwyork and @helenpcarr) and @suejbright. 11/of many
Now, on to "shared equity". I'm not sure on what the Minister's fandom is based. There are hardly any such products available, partly because they were magicked up to create a market. There is no empirical evidence of which I am aware about the model. 12/of many
And the legal model used is different depending on when created. But, if the Minister is referring to the trust model, as opposed to the leasehold model, perhaps what the Minister is saying is that he recognises the flaws in the leasehold model? 13/of many
If that is the case, then fair enough. But, be careful what you are wishing for. Because the trust model will require careful drafting, will be expensive to create and transfer, and is likely to contain not dissimilar provisions to those in the SO lease. 14/of many
I say "is likely" because I will hold up my hand and say, I don't know. But, does the Minister? If the trust document provides that the part-buyer is to pay 100% of service charges etc, then exactly the same problem arises. 15/of many
And, when it comes to a possession claim by the provider, it will become really quite messy potentially - the Trusts of Land etc Act 1996 possession process is different, and more expensive, from the kind of process leaseholders have to go through. 16/of many
And, as my wonderful land law students know, it is designed to balance out interests. Whether the model would actually achieve any form of levelling-up into ownership is also unclear, ... 17/of many
ie it was not designed for people on LA waiting lists who otherwise could not afford ownership.
So, all-in-all, may I respectfully suggest that the Minister take advice before expressing his fandom for a model. 18/of many
So, all-in-all, may I respectfully suggest that the Minister take advice before expressing his fandom for a model. 18/of many
In any event, Berkeley Homes can themselves hardly be held up as a model of a building company, working tirelessly for their residents. They appear to be as implicated in the #fleecehold scandal as any other building company - just google them and ground rent. 19/of many
As for the Minister's fandom for the discount model, again, this rather depends on the legal model being used, and it may be that the discount model was also used to inflate prices (but I'm not an economist and have no evidence of that beyond my nose). 20/of more
And, again, the Minister's fandom cannot be backed up by empirical evidence about the discount model. It lacks any form of evidence, and the terms will no doubt have been commercially weighted in favour of the provider. 21/of more
It would be interesting to hear of people's experiences of both shared equity and discount models. As my friend Rod says, #showmethedata
So, please, @team_greenhalgh #thinkbeforeyoutweet, and please recognise that, even if shared ownership works for many, it has stuffed some and is, as I said, a duff product in need of reform #JustDoIt 20something/end
