The Government has announced it wants to introduce a new national model for shared ownership – called Right to Shared Ownership.

Social tenants moving into new homes will be given the chance to buy a share with a stake of just 10% of the total property value, a cut from the current scheme which requires buyers to purchase at least 25%.

People will also be able to buy their home in 1% chunks – rather than 10% at a time.

The package of measures aims to give thousands of social tenants an opportunity to purchase a stake in their home. In some areas, this will mean people can get on the housing ladder with deposits as low as £2,000.

How it works?

Currently a Housing Association tenant renting a £200,000 property cannot buy a share of that property.

Under Right To Shared Ownership, the tenant could buy an initial 10% stake worth £20,000, while paying subsidised rent on the remaining 90% of the property.

The tenant could make up this 10% stake through a £2,000 deposit and a £18,000 mortgage.

Housing Secretary Robert Jenrick MP said: “Many people want to own their home, but can’t see a route towards achieving that goal. This government is determined to help people realise that ambition and boost ownership for thousands of hard-working people up and down the country.

“Owning a home is not just about the four walls around you, it’s about investing in your family, saving for the future and putting down roots in a community.

“These measures announced today will mean more people, including residents living in new housing association homes, are given the opportunity to get on to the housing ladder.

“For tenants in new housing association properties, there will be an automatic right to buy a share of their home from as little as 10%, with the ability to increase that share over time, up to full ownership.

What about those in existing social housing?

The Government will work with housing associations on a voluntary basis to determine what offer can be made to those in existing housing association properties, so that the new Right to Shared Ownership is extended as widely as possible.

It also wants to make costly fees fairer and proportional, and introduce a new streamlined valuation process to help further reduce costs.