Exposing the Flaws of Shared Ownership: A Response to Cheltenham Borough Council's Latest "Flagship" Scheme

The recent groundbreaking at 320 Swindon Road in St Paul’s, Cheltenham—a £6.2m project delivering 24 homes (17 apartments and 7 houses) via social rent and shared ownership—sounds like a win for affordability on paper. Council Leader Rowena Hay hailed it as a "great example of the high standard we work towards in providing safe and good quality housing that people can afford to live in," while Cabinet Member Alisha Lewis called it a "significant step forward" for those struggling to find a home. Partners like Homes England and contractor Speller Metcalfe emphasize sustainability features like solar panels and green spaces, with completion eyed for 2027.

But let's cut through the PR spin: shared ownership isn't the lifeline it's sold as. It's a flawed model that preys on the desperation for homeownership in an overheated market, locking people into high costs, limited control, and resale nightmares—all while propping up inflated house prices rather than tackling the root crisis. Cheltenham Borough Council (CBC) should ditch this half-measure and pivot to full social rent or truly affordable full-ownership sales at prices that reflect local wages, not developer dreams. Here's why, backed by hard evidence from across the UK.

1. It Exploits the Dream of Ownership While Delivering the Worst of Both Worlds

Shared ownership lets buyers snag a 25-75% stake in a property (often new-builds like those at Swindon Road) and pay "subsidized" rent on the rest, marketed as a "stepping stone" to full ownership. CBC's own sales policy pitches initial shares at 25-40% of market value, with rent on the unsold equity capped at around 2.75% annually. Sounds empowering? In reality, buyers foot 100% of the service charges, maintenance, and repairs—regardless of their share size—while the housing association (HA) or council pockets rent hikes and revaluation fees when you try to "staircase" up.

This isn't security; it's a trap. As one shared owner put it on X: "I’ll never understand how... they can ask for an extra £1,000 a month in service charges. Shared ownership is not affordable housing and is a con." Another called it "degrading and unsustainable," citing maintenance battles that echo leasehold woes. MPs on the Levelling Up, Housing and Communities Committee slammed it as "drastically failing to deliver an affordable route to homeownership," subjecting buyers to "rising rents, uncapped service charges, and a disproportionate exposure to repair and maintenance costs."

2. Hidden Costs That Spiral Out of Control

Service charges are the killer. Uncapped and often rising 40-400% post-purchase, they dwarf initial estimates (e.g., £120/month marketed, ballooning to £417+). One London shared owner saw theirs hit £16,000 annually for a one-bed flat, trapping them in negative equity while juggling mortgage, rent, and fees. The Housing Ombudsman highlights "errors in the sales process" where charges surprise buyers on move-in, with HAs failing to manage freeholders effectively.

Rent? It can exceed inflation caps indirectly, and even after death, heirs get hit with bills for unused services. Financial journalist Paul Lewis nails it: "Shared ownership isn’t ownership and isn’t shared—you pay all the costs. It is definitely not cheap or for most people affordable." In Cheltenham, where CBC once outsourced to Cheltenham Borough Homes (now folding amid regulatory scrutiny), tenants and owners alike face opaque charges without direct council accountability.

3. Resale Hell: Trapped with No Escape Hatch

Want out? Good luck. You can't sell on the open market—HAs get first refusal (up to 8 weeks in CBC schemes), dictating prices via forced valuations that undervalue your share. No subletting without permission, and building safety defects (e.g., cladding) make shares unmortgageable, leaving owners "trapped in properties they can no longer afford." One X user warned: "Avoid Shared Ownership at all costs... it’s a con!" citing resale as a key flaw.

The government's own response admits providers have "no obligation to buy back shares," stranding families amid rising costs. In London (mirroring Cheltenham's pressures), sellers face 14 failed buyers due to HA criteria and affordability checks. MPs call for urgent lease reforms to cap charges proportionate to shares owned.

4. The Ideology: Propping Up a Broken Market, Not Fixing It

Shared ownership isn't progressive—it's a band-aid that sustains sky-high prices. By injecting HA/council demand (funded by taxpayers via Homes England), it bids up values, making full affordability elusive. As one analyst noted, it's "another layer of government entanglement in an already broken market." Critics accuse HAs of mis-selling with lowballed estimates, leading to legal challenges. The Ombudsman urges a "fundamental rethink" of its "inherent complexity and inequities."

In Cheltenham, where objections already pile up against shared ownership-heavy schemes (e.g., 122 homes at The Folly, facing parking and infrastructure woes), this Swindon Road project risks the same backlash. CBC's shift to in-house management post-CBH exposes more liability—why gamble on a model MPs say has "failed to deliver"?

Call to Action: CBC, Choose Better

Cheltenham deserves homes that build wealth and stability, not extract it. Scrap shared ownership from Swindon Road and future projects—go full social rent for security, or sell outright at genuine affordable prices (e.g., 60-80% market value, no strings). Contact your councillors, join campaigns like the Social Housing Action Campaign, and amplify voices like those on X warning it's "not a step onto the ‘housing ladder’." Let's hold CBC accountable: true affordability means control, not concessions.

https://www.cheltenham.gov.uk/news/article/3075/exciting_new_flagship_development_is_breaking_ground