Damning MPs’ report blasts failed shared ownership schemes

The cross-party Levelling Up, Housing and Communities Committee of MPs has blasted shared ownership for failing to deliver an affordable route to homeownership.

A damning report published after MPs had already left for their Easter Break revealed that the schemes are ‘drastically failing to deliver’ an affordable route to homeownership for too many people and subject buyers to rising rents, uncapped service charges and a disproportionate exposure to repair and maintenance costs.

SUBSIDISED RENT

The ownership model enables people to buy a share in a property, usually from a Housing Association, and pay subsidised rent on the rest.

Sometimes known as ‘part buy, part rent’, shared ownership requires a smaller deposit and mortgage, making it, in theory, a more affordable route into homeownership than buying on the open market.

But the MPs’ report found that rents, service charges and the complexity of homeownership leases make shared ownership an unbearable reality for many people seeking to take the step to become full, 100% homeowners.

Clive Betts, Chair of the Levelling Up, Housing and Communities (LUHC) Committee and Labour MP for Sheffield South East, says: “Shared ownership was hailed as an answer to the housing crisis especially for first-time buyers.

“However, we have found that for too many people shared ownership becomes an unbearable reality, where a blizzard of charges and an unfair burden for maintenance and repair costs means that they are unable to afford full homeownership.”

“Rising rents, hefty service charges, complex leases, disproportionate repairs and maintenance costs are experienced by too many people who take the shared ownership route.”

URGENT ACTION

And he adds: “The Government needs to take clear and urgent action to tackle these issues and ensure shared ownership genuinely delivers affordable homeownership”.

The report calls on the Government and Homes England to improve the accessibility and quality of guidance and ensure providers offer the specialist advice needed to understand complex shared ownership leases.

It also recommends that the Government examine how it can ensure shared owners are only ever liable for repairs and maintenance costs proportionate to the size of share they own and ensure the Regulator for Social Housing updates its Tenant Satisfaction Measures to include satisfaction with repairs and maintenance for shared owners.