Lender calls for policy changes as white paper highlights barriers to homeownership
The government is facing renewed calls to reform its shared ownership policy following a recent submission to Downing Street by specialist lender Pepper Money.
Rob Barnard, intermediary relationship director at Pepper Money, presented the firm’s white paper to Number 10, emphasising the lender’s ongoing support for the tenure.
Pepper Money’s report reaffirms the significance of shared ownership in the UK’s evolving housing landscape. The document advocates for a more inclusive approach to shared ownership, ahead of the government’s full prospectus for the new Social and Affordable Homes Programme, due in the autumn. Ministers have already confirmed that shared ownership will remain part of the affordable housing mix.
The white paper, developed with input from two independent experts—former Bank of England economist Rob Thomas and former chief secretary to the Treasury David Gauke—sets out three key policy recommendations. These proposals aim to ensure shared ownership adapts to economic conditions, supports financial recovery, and maintains a central role in the government’s housing strategy.
Central to the recommendations is the objective of expanding access to shared ownership through financially prudent and sustainable measures. The proposals seek to increase accessibility, provide greater confidence in the tenure’s future, and enhance transparency for long-term planning.
The report calls for the creation of an independent body to collect and publish industry data, enabling policymakers and stakeholders to assess the effectiveness of shared ownership and identify areas for improvement. It also recommends raising the household income cap annually in line with average earnings growth, noting that the current thresholds—£80,000 nationally and £90,000 in London—have not changed since 2016 and have declined in real terms due to inflation. Without adjustment, the report warns, shared ownership could become inaccessible to those it is intended to help, undermining both demand and supply.
A further recommendation is to review Homes England’s Capital Funding Guide to establish a more consistent approach for applicants who do not meet standard high street lending criteria.
The white paper also highlights the affordability gap that shared ownership helps to address. In 2023–24, the average shared ownership purchaser acquired a 40% share of a property valued at £313,100, with a deposit of £22,800 and a mortgage of £99,200. By contrast, the average first-time buyer in England required a deposit of £69,000 and a mortgage advance of £223,000. In London, the deposit gap is even greater, reaching £155,000. These figures illustrate the continuing importance of shared ownership in enabling access to homeownership for those unable to meet the requirements of the open market.
“Shared ownership offers a vital bridge to the housing market for so many people who otherwise would struggle to buy their own home, but we know without action, this bridge will get harder to use for those who need it,” said Rob Barnard (pictured top), intermediary relationship director at Pepper Money.
“Our policy recommendations are pragmatic, cost effective, and provide certainty for the sector to ensure that shared ownership continues to be the vital pathway to home ownership so many rely on. The government has rightly outlined their ambition to build 1.5 million homes by the next election, and that can only be achieved by supporting a range of types of home ownership, including shared ownership.
“The unintended consequence of the status quo is a less viable tenure, with shared ownership becoming less accessible for financially capable people seeking their own home and has the potential to undercut the government’s own bold house building ambitions.”
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