Housing minister mulling over improvements to shared ownership

Shared ownership has received tens of millions in public funding under previous affordable homes programmes, and Inside Housing understands that as much as 30% could be directed to this tenure under the new SAHP.

An MP-led inquiry last year called for “urgent” reforms to the model after it found that uncapped service charges, rising rents and unfair maintenance costs made the tenure unaffordable.

The government’s housing committee also found that shared ownership was supposed to be an “affordable route to homeownership”, but has “failed to deliver on this for too many people, for too long”.

It said the government should explore how to improve lease terms for shared owners by making sure they are only liable for repairs and maintenance costs proportionate to the size of their stake in the property, as part of a broader package of reform to the tenure.

Inside Housing subsequently revealed internal emails from the Ministry of Housing, Communities and Local Government and Homes England that revealed both were left “taken aback” and “unimpressed” by the inquiry’s findings.

Since then, a Shared Ownership Code has been launched in a bid to standardise the offer and drive investment.

Created by the Shared Ownership Council, a cross-sector initiative, the code aims to improve customer service and satisfaction. It is also hoped a more standardised model may help unlock additional investment in the tenure.

At another conference panel on Tuesday, this time hosted by the Institute for Public Policy Research and homelessness charity Crisis, the role of shared ownership came up as part of a discussion on supply solutions to the housing crisis.

Matt Downie, chief executive of Crisis, said: “Shared ownership – I find fascinating because I’ve seen data from one of the biggest providers of shared ownership about the people who are purchasing through them, and they discovered the number one reason that people wanted shared ownership wasn’t to get on the housing ladder, it was security of tenure, which they are not getting through the PRS [private rented sector].

“So it’s a solution which is running after the wrong problem: which is how we regulate the PRS.”

Emily Darlington, Labour MP for Milton Keynes Central, said service charges are a “scam” and part of an issue that is caught up in part of the wider leasehold system, which she described as “fleecehold”.

She said: “Whether it’s green space, roads or whatever that they charge and it’s not passed over to the council, quite frankly they charge what they like. It’s not like there is a market, we can do stuff like Right to Manage, but the reality is we just need to stop it. You’re buying a house, not a share of the road.”

Vicky Spratt, housing correspondent at the i newspaper, said: “It’s this incredibly romantic product. So what if we just stopped doing it and fixed all the other stuff. 

“Just put a pin in it. I hear from so many people who are being hammered by their rent and have all sorts of problems trying to sell their shared ownership homes, and that doesn’t get talked about enough.”

Inside Housing revealed last month that shared owners at a block in Battersea, south-west London, could be left footing the bill for services provided to private flatowners on a large estate as Notting Hill Genesis seeks to challenge an earlier tribunal ruling.