Shared Ownership Scheme Faces Affordability Concerns
Why this is here: The NAO report detailed how one homeowner received an unexpected bill for over £2,000 after their housing association underestimated the previous year's service charge, illustrating the financial uncertainty faced by shared ownership participants.
A National Audit Office (NAO) report revealed complexities within England’s shared ownership scheme are creating financial pressures for homeowners. The scheme allows buyers to purchase portions of a property, but the report found increasing service charges and a lack of understanding about long-term costs are common issues.
Some shared owners reported service charges rising sharply, with one single parent facing costs exceeding £8,000 annually—a nearly 50% increase in four years. These rising costs, combined with rent and mortgage payments, are making homes unsustainable for some, and hindering their ability to “staircase” – fully purchase their property.
The NAO found the scheme is forecast to be cheaper than private renting over ten years in 93% of areas, averaging £29,000 savings nationally and £42,000 in London. However, the report warns the government must improve the scheme to ensure truly affordable housing.