The National Audit Office report says complexities within shared ownership mean customers can be caught out by issues such as increasing service charges, and many who take up the scheme don't fully understand the longer-term financial risks. Shared ownership is a government-backed affordable housing scheme that allows eligible buyers to purchase a property in portions over time to help them move into home ownership. Limited government data means it is difficult to assess shared ownership schemes' overall performance.
Case studies illustrate the financial strains: twin brothers Riccardo and Simone Bertagna bought a 25% stake in a three-bedroom flat in Seven Sisters, north London, through a housing association. Their flat was devastated by an external leak a few years ago, and their monthly service charge has continued to rise to just under £300 despite issues like leaks, a broken lift, and dirty communal areas. Jamie Sugar bought a 25% share of a three-bedroom flat in north London through shared ownership, and her service charges rose to more than £8,000 per year, an increase of nearly 50% in under four years.
From April, Jamie Sugar faces paying £683 per month in service charges on top of her rent and mortgage payments, and her housing costs, before bills, now take up more than half of her income. Systemic issues include that shared owners have a long lease, with all associated obligations including paying service charges, and there is currently no standardised format or terminology for service charges. Riccardo and Simone Bertagna are among a hundred or so people who have contacted Your Voice, Your BBC News about issues they face in shared ownership properties.
The housing association told the BBC that Riccardo and Simone Bertagna's concerns are being investigated and that shared ownership responsibilities are clearly set out before purchase. In England, shared ownership is the largest affordable housing scheme for home ownership, with eligible buyers being those who cannot afford a full deposit and mortgage and whose household income is below £80,000 (or £90,000 in London). Shared ownership homes are usually sold through a social landlord, often a housing association.