Response: NAO shared ownership report

On 25 March 2026, the National Audit Office (NAO) published a report on their investigation into shared ownership. The report sets out:

• how the shared ownership model works (in England)
• challenges that affect shared ownership
• redress (routes for complaints and resolution) for shared owners, and
• improvements made to the model by MHCLG and Homes England

“Shared ownership remains an important route into home ownership, but it is complex, and weaknesses in information, affordability, data quality and redress mean that government does not yet have a full understanding of how the model works for consumers.”

Gareth Davies, Head of the National Audit Office

The NAO report does not examine the value for money of shared ownership or make recommendations.

We discuss the report in more detail below.

Part One: About shared ownership

Popularity v satisfaction

Shared ownership providers and other stakeholders told the National Audit Office that shared ownership is “popular with consumers”.

However, the authors also note Regulator of Social Housing (RSH) tenant satisfaction measures (TSMs), which show overall satisfaction is just 48%.

The new model: unintended consequences and long-term outcomes

The NAO report discusses unintended consequences of changes to shared ownership from the perspective of shared ownership providers.

‘Shared ownership has evolved over time to address issues, but some changes to the AHP (Affordable Housing Programme) have had unanticipated consequences. Most notably, shared ownership providers told us that the decreased initial share a household can buy is intended to enable those with less money to invest upfront to become a shared owner. However, it means that shared ownership providers receive less upfront capital and are paying more on loans taken out to cover the cost of the unsold portion of the property.‘

In our 2022 response to the ‘new model’ for shared ownership – Shared ownership reform: what would success look like – we questioned the value of introducing 10% minimum shares and 1% incremental staircasing from a shared owner perspective. We asked:

• whether households who can afford only a 10% share would be likely to experience financial challenges as rent and service charges rise?

• whether some households could find themselves stuck on the lower rungs of the housing ladder with no viable exit route?

The Social and Affordable Homes Programme 2026–2036

In our 2023 report, Shared ownership: the consumer perspective, we explained how transparency and fairness are lacking.

The NAO report explains that: ‘The Social and Affordable Homes Programme 2026-2036 is introducing new expectations for shared ownership providers to improve the customer experience’. Adding: ‘This includes giving greater consideration to long-term customer affordability, increasing transparency and fairness on costs, and giving customers the ability to opt out of fees for services that are optional’.

Recent changes to housing legislation

The NAO report discusses recent changes to housing legislation. However, a legal right is only of value so long as access to that right is affordable.

The Renters Rights Act 2025 ends mandatory repossession for shared owners who fall into rent arrears. But lease extension reform – under the Leasehold and Freehold Reform Act 2024 – doesn’t address the fact that those with the lowest number of years remaining on their leases will still be liable for the highest premiums. Lease extension could remain out of reach for long-term shared owners. Many of whom consider they were mis-sold their ‘short’ 99-year leases.

Whilst the report references ground rent reform it is not yet clear whether ground rent payable on the landlord’s share will be excluded from reforms.

Part Two: Challenges with the shared ownership model

The report sets out two main sets of challenges associated with the shared ownership model:

• a lack of information, and
• affordability over time.

Information

The report makes reference to the new Shared Ownership Code which aims to improve and standardise information about costs and processes.

Affordability and staircasing

Per the report, affordability pressures are likely to pose the greatest risk to households with limited financial headroom. Barriers to staircasing include complexity, rising property prices and multiple transaction costs.

Shared ownership and wider issues

Complexity is not limited to issues faced by leaseholders more generally. ‘Shared owners are subject to all the standard issues of leasehold ownership such as uncapped service charges and complex management, as well as having specific challenges that are unique to shared ownership, such as staircasing’.

Part Three: Monitoring and improving shared ownership

Monitoring and outcomes

In Part Two, the report tackled ‘information gaps’ in shared owners’ understanding. In Part Three, the report goes on to discuss gaps in government’s understanding of outcomes, stating that ‘MHCLG’s ability to track shared ownership outcomes and identify where the model works most effectively’ is limited by incomplete data.

Redress and complaints

The report acknowledges that the redress process for shared owners is complex, and that they may not be fully aware of their options.

Improvements to the shared ownership model

Recommendations are outside the scope of the National Audit Office report. However, it concludes by stating that updates to the CORE (Continuous Recording of Lettings and Sales in Social Housing in England) dataset will enable MHCLG to assess the effectiveness of policy changes. Adding: ‘This should allow it to strengthen future policy design through a more thorough understanding of how shared owners progress from initial purchase to full ownership’..

Of course, not all shared owners do progress to full ownership.

What next?

In our 2022 report, Shared ownership: the consumer perspective, we made a number of recommendations, including that government and the Regulator of Social Housing should ensure improved data collection, evaluation and reporting on outcomes and impact.

Government and the Regulator of Social Housing should undertake robust data collection, evaluation and reporting on the ongoing financial sustainability of shared ownership.

Government and the Regulator of Social Housing should undertake robust data collection, evaluation and reporting on the extent of shared owner transition to full ownership.

It is vital that a granular assessment of the scheme is undertaken to assess outcomes, impact and value-for-money – for shared owners, people who inherit shared ownership homes and the public purse.

Any such assessment should prioritise ‘win-win’ recommendations to ensure that the scheme delivers on its promises of affordability and/or a pathway to full home ownership – both for future entrants to the scheme and for current shared owners. Or, at the very least, fund viable exit routes for households who currently find themselves ‘trapped’ in homes that are increasingly unsuitable and/or unaffordable.

Featured image: David Pearson on Wikimedia Commons (cropped)

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Additional Resources

National Audit Office: Investigation into shared ownership

Shared Ownership Resources: Shared Ownership: the consumer perspective