Right to Shared Ownership – the end of a short-lived product and what it means for registered providers

The Right to Shared Ownership (RtSO) scheme was one of the defining features introduced by the Affordable Homes Programme (AHP) 2021–2026, giving eligible tenants the ability to purchase a stake in their rented home.

However, Homes England’s new Social and Affordable Homes Programme (SAHP) 2026–2036 marks a significant policy shift, in that RtSO will not feature in the updated grant funding requirements for this programme. Whilst the Capital Funding Guide (CFG) still contains RtSO provisions for homes delivered under the 2021–2026 programme, these obligations do not extend to new homes funded under SAHP.

For further context, see our previous article, which explored the operational challenges of implementing RtSO under the earlier programme.

RtSO: a brief recap

Under the 2021–2026 AHP programme, RtSO allowed tenants in new homes delivered through grant funding to buy an initial equity share (10–75%) and staircase over time. This was enshrined in the CFG and widely promoted as a new route to affordable homeownership.

What’s changed in 2026–2036?

The new SAHP focuses heavily on ‘social rent’ – where rent is ‘based on a government formula based combination of local incomes and local property values’ – with at least 60% of funded homes expected to fall under this tenure. While shared ownership remains a funded product, RtSO is no longer mandated or supported by grant conditions. This shift reflects the government’s desire to protect social housing stock, similar to recent measures such as reducing Right to Buy discounts.

Implications for registered providers

Transitional obligations

• Homes delivered under the 2021–2026 programme retain RtSO requirements. Registered providers (RPs) must continue to honour these rights for eligible tenants, even as new homes under SAHP do not carry the same obligations. This creates a dual compliance framework that will persist for years.

Portfolio management challenges

• Mixed legacy stock: RPs will manage homes built under two different regimes – some with RtSO obligations, and others without. This creates complexity in lease terms, customer expectations, and long-term asset planning.
• Valuation and resale risks: homes under RtSO may require different valuation and resale processes compared to those without the right, increasing the administrative burden.

Customer communication and expectations

• Tenants moving into homes funded under SAHP may assume RtSO still applies. Clear messaging will be essential to avoid disputes and reputational risk.
• Providers will need robust FAQs, training for frontline staff, and transparent marketing materials to explain the change.

Strategic planning and financial impact

• RtSO previously offered a predictable route for capital recycling and income generation. Its removal may affect long-term financial modelling and assumptions around staircasing receipts.
• The increased focus on social rent will require RPs to review development strategies and financial models to ensure schemes remain viable under the new funding priorities.
• RPs will need to assess the additional costs involved in managing mixed legacy stock and staff training.

What should RPs do now?

• Audit existing stock: identify homes with RtSO obligations and plan for their management alongside new SAHP-funded homes.
• Update policies and customer literature: ensure clarity on eligibility and rights for new tenants.
• Seek guidance and advice from legal representatives: understand contractual obligations, compliance risks, and options for managing mixed-tenure portfolios under two different regulatory frameworks.
• Scenario planning: model financial impacts of reduced staircasing income and increased focus on social rent.

Conclusion

The removal of RtSO from the 2026–2036 programme represents more than a technical policy change – it reshapes the relationship between RPs and their customers. While the new SAHP reflects the government’s commitment to protecting social housing, RPs must act now to manage the operational and strategic challenges this shift brings.