A housing charity has called for a massive expansion of shared ownership homes for a generation of "forgotten families" in the North West priced out of home ownership.
In a new report, Shelter found that a large number of middle-income families earning between £20,000 and £40,000 could find themselves stuck on the first rung of the property ladder or facing the prospect of years of private renting. Shelter estimates that as many as 1.8 million families in England could fall into this group.
Its analysis of incomes and house prices showed that in the North West, rising property prices mean the traditional market leaves two in five of these families (40%) priced out of a family-sized home.
New figures from the charity found that the mortgage guarantees of Help to Buy to be rolled out in January will still leave many priced out, with nearly half (47%) of families in the North West on low or average incomes still unable to afford the monthly mortgage repayments, even if they have the funds for a deposit.
But the report also found that mortgage repayments on a shared ownership home in the North West would be affordable for 100% of families on low or middle incomes.
Shelter is now calling for a major new house building programme.
An investment of £12 billion could build 600,000 new shared ownership homes, the charity said.
Kay Boycott, director of campaigns and policy at Shelter, said: "We need to see a new generation of shared ownership for ordinary families in the North West who are locked out of social housing and priced out of home ownership. The reality is that soaring house prices mean that the traditional market is no longer working for ordinary people.
"Building the new shared ownership homes we desperately need is the only way to give thousands of families a stake in the stable home they want at a price they can afford.
"So far, years of piecemeal policies and an alphabet soup of confusing schemes have meant that shared ownership has failed to reach its potential, leaving it nowhere close to meeting the needs of England's forgotten families. But for the many young people in the North West who are desperate to do what generations have before them and find a stable home of their own, a national shared ownership programme is the bold and radical solution we need.
"Every day, Shelter's housing advisers see the consequences of our growing housing shortage, from those not knowing where they'll sleep that night to families struggling to pay their rent or mortgage. However, shared ownership won't work for everyone, and we need a mix of new homes, including desperately-needed new social housing."
Stephen Smith, director of housing and external affairs at Legal & General, said: "This report demonstrates the need for much more intermediate tenure provision across the UK, but also that the plethora of schemes we have had to date have served to confuse rather than give confidence to lenders and buyers.
"A single scheme, which is clearly described and clearly understood by buyers and lenders alike would be a great step forward. But fundamentally, for low and middle income earners, shared ownership has a big role to play in getting families into decent homes."
Housing minister Mark Prisk said: "Shelter's report fails to take into account the billions of pounds we're investing to getting Britain building, leading to the fastest rate of affordable house building for two decades, on top of the 19,000 shared ownership homes we've delivered over the past two years.
"This is just one part of a range of measures we've put in place to ensure anyone who works hard and wants to get on the housing ladder has the support to do so.
"Additionally we are tackling the record deficit to help keep interest rates low and ensuring that affordability for first-time buyers is at its most favourable level since 2003.
"As a result, the number of first time buyers is at its highest level for six years."