Q&A with Homes England: Guidance for housing providers

Homes England publish a Capital Funding Guide for shared ownership landlords. But it doesn’t apply to all providers of shared ownership. Homes England explain in this Q&A.

Read on…

Q1. What is Homes England?

Homes England is the government’s housing and regeneration agency. The agency publishes a Capital Funding Guide for housing providers, which includes a section on shared ownership.

Q2. Does Homes England’s guidance apply to all shared ownership homes?

Homes England’s guidance only covers homes that have been delivered through one of its affordable homes programmes. These programmes are applicable to the whole of England but excluding London.

Affordable homes programmes in London fall under the responsibility of the Greater London Authority (GLA). The GLA has its own equivalent of Homes England’s Capital Funding Guide: the Affordable Housing Capital Funding Guide. Section 4.1 covers shared ownership homes within London.

Some shared ownership homes are delivered outside of a Homes England or GLA affordable homes programme. These may be through Section 106 agreements or privately funded.

Q3. What is a Section 106 agreement?

What is a Section 106 agreement? This is a legal agreement between a developer and the local authority to deliver affordable homes alongside the ones that are built for market sale. 

A Section 106 (S106) agreement is a legal agreement between a developer and the local authority. It requires developers to contribute towards the provision of various infrastructure and services that a local authority requires. This contribution is in return for the local authority giving their planning permission. Provision could be in terms of community facilities, public open space, transport improvements and, commonly, the provision of affordable housing. 

Q4. How many shared ownership homes are provided through S106 agreements?

This will vary year to year but, for many years, around half of shared ownership homes were provided through S106 agreements.  

Q5. Are S106 shared ownership homes required to follow Homes England’s guidance if they do not form part of its own affordable homes programme?

No. If a shared ownership home was not delivered through one of its programmes then it is not subject to Homes England’s guidance.

The main elements of the “new” shared ownership model introduced by Government in April 2021 need to be provided for S106 shared ownership homes as well as those delivered through an affordable homes programme. This is to provide consistency and fairness in terms of the shared ownership product on offer to applicants as regards new shared ownership homes.

Local connection criteria

Where S106 homes can vary from Homes England grant-funded homes is in the shared ownership eligibility criteria. Many S106 agreements will include some form of local connection eligibility criteria for shared ownership homes. These typically state that an applicant must live, work or have close family ties within a specified area.

Whereas for shared ownership homes provided through one of Homes England’s affordable homes programmes applicants must be dealt with on a first come, first served basis.

It is also possible for local authorities to establish within a S106 agreement a minimum initial share level that can be purchased. This is as opposed to having to offer the full range of shares between 10% and 75% over a certain proportion of homes on a scheme as is required on schemes funded by Homes England.

Q6. Are there any differences between shared ownership homes provided within and outside of London?

There may be some minor differences between the two sets of guidance, but the key elements of shared ownership remain the same within and outside of London. The same shared ownership model leases are used and both require Key Information Documents to be provided.

The main difference between the two sets of guidance is in terms of the methodology and requirements around assessing the affordability of shared ownership applicants. The recent revisions to Homes England’s guidance on shared ownership valuations have been shared with the GLA but it will be their decision as to the extent, if at all, they wish to incorporate Homes England’s guidance into their own.

Q7. Who does Homes England fund to provide shared ownership homes?

Traditional housing associations, local authorities and “for profits”

In recent years (since 2016) Homes England has funded approximately 300 different affordable housing providers to deliver shared ownership homes at any one time. The significant majority (80%) are traditional housing associations. The other 20% is split between local authorities and what are termed “for profit” affordable housing providers.

Registered Providers and Unregistered Bodies

Some “for profits” are Registered Providers in terms of being registered with, and regulated by, the Regulator of Social Housing. Others will be what are commonly termed “Unregistered Bodies”.  These are organisations that are not registered with, and therefore not regulated by, the Regulator of Social Housing.

Only Registered Providers are required to be a member of the Housing Ombudsman Service.  For Unregistered Bodies membership is voluntary rather than mandatory. 

Unlike for rented housing, Unregistered Bodies can own and manage shared ownership homes. In practice, however, this is rare because mortgage lenders typically only lend on homes where the provider is regulated. Some Unregistered Bodies develop shared ownership homes with Homes England grant funding and then pass them on to a Registered Provider for ownership and/or management on completion.

Size

Shared ownership providers funded by Homes England range in size from small, locally based organisations with shared ownership homes in single figures to large organisations with hundreds, and sometimes thousands, of shared ownership homes developed in recent years.

Predecessor organisations to Homes England have been funding shared ownership homes since 1980. This means that some organisations have come to own significant numbers of shared ownership homes over time, despite some staircasing to 100% (by the shared owner or to enable a sale outright on the open market).  For example, the latest available figures show 22 organisations owning more than 3,000 shared ownership properties each.

DISCLAIMER:

This Q&A is accurate, to the best of our knowledge, as at October 2026. However guidance is updated on a regular basis, so please check Homes England’s current Capital Funding Guide, and/or seek expert legal advice if required.

The information provided on this website is for general purposes only. It is not intended to be a substitute for legal, financial, tax or other professional advice. Everyone’s situation is different so always seek expert advice on any questions you may have.

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