Making Homes Affordable

CottageThe burden of debt related to housing doesn’t just affect the poorest in society. Increasingly families from all of walks of life are facing up to spiralling housing costs and hard to get mortgages. Our concept of shared equity and ownership relies on a diverse mix of tenants who need affordable homes.

The housing market has gone through many upheavals in recent decades. In February 2013 home ownership in the UK fell to its lowest level since 1987, marking an abrupt end to a trend that saw it peak at 70.9 per cent of households in 2003. The financial crisis of 2007 showed the world that credit based housing markets are inherently unstable, and that in the long run, no one is safe when a property boom goes bust.

It’s hard to believe just how hard it is to go on the property ladder today. In 1971 the average salary in the UK was roughly £2,000 a year while the average house sold for £5,632. In 2013 the average price for a home is £238,293  while the average salary sits at about £25,000.

In Scotland the average house price has increased from £73,570 in 2001 to £179,863 in 2011, a massive increase of 144 per cent.

Owning a house in today’s market is major financial undertaking that often relies on other forms of capital such as inherited wealth, even if the owners in question have well paid jobs. More and more people are simply priced out of the market.

Our model will be based on a portfolio of properties, with roughly 5 tenants paying market rent, supporting one low-income tenant paying affordable rent. However, even when paying a market rent 10% is gifted back to them in shares - so in effect they are paying 90% rent.

MEHO makes much more sense for everyone.

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Contact Details

The Caledonian Foundation is a registered charity in Scotland
Scottish Charity no. SC042872.
2 Lower Gilmore Place

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