Policy background Home ownership
In England most of the available data shows that the aspiration to buy and own a home remains strong for the majority of households. Over half (57%) of private renters and around a quarter (24%) of social renters in the UK think they will eventually buy their own home. This desire to achieve home ownership is also reflected in the latest British Social Attitudes survey which reported that 86% of people aspire to own their own home (https://www.gov.uk/government/statistics/english-housing-survey-2014-to-2015-headline-report).
	Around two thirds of social renters (68%) and three fifths (60%) of private renters stated, as their main or only reason for why they don’t expect to buy their own home in the UK, that they would be unable to afford it.
	Of the estimated 22.5 million households in England in 2014-15, 14.3 million or 64% were owner occupiers. The proportion of all households in owner occupation increased steadily from the 1980s to 2003 when it reached a peak of 71%. A period of gradual decline in owner occupation followed but this seems to have abated with no change in owner occupation rates between 2013-14 and 2014-15. (https://www.gov.uk/government/statistics/english-housing-survey-2014-to-2015-headline-report).
	Although now abated, the long-term downward trend in owner occupation has disproportionately affected younger households. Of those households that do own their home 75% are over the age of 45 and nearly half (46%) of households in the 25-34 age group live in the private rented sector (only 21% were renting privately in 2003-04). Over the last twenty years, the proportion of under 40 year olds who own their home has fallen by over a third from 61% to 38% (https://www.gov.uk/government/statistics/english-housing-survey-2014-to-2015-headline-report) and, in 2014, the Office for National Statistics (ONS) reported that 3.3 million people between the ages of 20 and 34 were still living with their parents (accounting for 26% of the age group).
	The number of first-time buyers since the financial crash of 2007-08, as measured by the number of mortgages issued to first-time buyers, has fallen significantly. Throughout the 1980s and 1990s the number of mortgages to this group averaged over 400,000 per year (https://www.cml.org.uk/news/723/) but between 2008 and 2014 the average annual number of loans has been fewer than 300,000.
	In its manifesto the Government committed to "build more homes that people can afford, including 200,000 starter homes exclusively for first-time buyers under 40". The Act requires local planning authorities to actively promote the development of starter homes for first-time buyers between the ages of 23 and 40. Starter homes will be sold at a minimum 20% below the market price to provide the opportunity for more young, first-time buyers to get onto the housing ladder.
	The Government also announced its intention to extend the Right to Buy to the tenants of housing associations in its manifesto. Working with the National Housing Federation, the Government has secured an agreement with housing associations to give their tenants the opportunity to buy their home with an equivalent discount to the Right to Buy.
	Homes sold to tenants under this agreement will be replaced on a one-for-one basis nationally using the proceeds from the sale of the property. This seeks to support an increase to the overall supply of new housing.
	The Government will compensate the housing association for the discount offered to the tenant, and housing associations will retain the sales receipt to enable them to reinvest in the delivery of new homes.