The Staircase That Goes Nowhere: You Own 30%. You Pay 100%.

By David Wood · Published 20 August 2026

He owns 30% of his flat. He pays the building-insurance premium through his service charge. After a leak from a housing-association-owned flat above, he says he paid a £2,500 excess. The housing association owns the other 70% of his home.

So which part of the risk, exactly, is being shared?

That question belongs to the roughly 252,000 households in England who hold shared-ownership leases, a number that has grown from 161,000 in just five years. The tenure is small, around 1% of all English households. But it is far more important than that number suggests. In 2024-25, more than 20,000 new shared-ownership homes were delivered, making up around 11% of all new-build housing supply and roughly 31% of affordable housing completions. This is not a marginal experiment. It is one of the central mechanisms through which the government delivers new homes to people who cannot afford to buy outright.

The product is sold with a metaphor: shared ownership is a staircase. You start with a share you can afford, typically between 10% and 75%. You pay a mortgage on that share, rent to the housing provider on the remainder, and service charges on the dwelling. Over time, you buy more. Eventually, if things go well, you reach 100%. A staircase has a top. The metaphor implies you will reach it.

After decades of promoting this product, government still cannot tell us how likely a buyer is to get there. And the evidence that does exist suggests that equity is the only thing being shared cleanly. Cost, risk and control each follow different rules.

The missing step

The most significant finding in recent official scrutiny of shared ownership is not that few people staircase, it is that the data to answer the question properly do not exist. The National Audit Office concluded in March 2026 that the Ministry of Housing, Communities and Local Government cannot currently determine the rate at which shared owners increase their equity or the likelihood that they will do so. This is an extraordinary evidence gap for a tenure whose entire consumer proposition is built around progression.

The gap is structural. The department's historic data system, CORE, recorded first-tranche sales and final staircasing events but did not adequately record partial staircasing, the intermediate purchases that would show whether a household was climbing at all. New questions were introduced from 2023-24, but poor response rates and data-quality problems mean the information is not yet robust enough to answer the central longitudinal question: of the people who enter shared ownership, how many progress, how quickly, and how many remain permanently at their original share?

What we do know is that final staircasing is numerically modest. In 2024-25, 4,781 sales reached 100% equity. Set against the English Housing Survey's estimate of 252,000 shared-owner households, that is a crude annual flow of about 1.9% of current stock. But that figure is emphatically not an eventual staircasing rate; the people reaching 100% in any given year may have bought years or decades earlier. The stock estimate includes many recent purchasers who have had little opportunity to staircase. A journalistically attractive claim such as "only 2% staircase" would be wrong. Any honest account of the data must resist turning a flow-to-stock ratio into a success rate. Annual final staircasing has fluctuated between roughly 3,500 and 6,000 in recent years, falling sharply when interest rates rose.

The policy response to these gaps has been to redefine success. The 2024 Commons inquiry put the traditional interpretation starkly: shared ownership as an affordable-homeownership product is predicated upon buyers being able to save and staircase, potentially to 100%. Government did not wholly accept that measure. Its response stressed that full ownership is "not the only positive outcome," because long-term partial ownership can still produce equity and greater security than private renting.

There is a reasonable argument behind that. Someone who permanently owns 30% may still have accumulated an asset, gained exposure to some property appreciation, and obtained a more secure home than they could find in the private rented sector. But it creates an important problem of political language. Shared ownership should not simultaneously be defended as a staircase when attracting purchasers and defended as successful without staircasing when evaluating outcomes, unless both objectives are explicitly measured. The staircase has not formally disappeared. What has changed is the government's willingness to say that arriving at the top is not the only measure of whether the journey was worthwhile.

The precise numbers remain unavailable. But the broad picture is not seriously in doubt. With roughly 252,000 shared-owner households and annual final staircasing running between 3,500 and 6,000 even in good years, the vast majority of shared owners do not reach 100%. Government's own shift, from defending the staircase to defending permanent partial ownership, implicitly concedes this. The more important question is why.

You own 30%. You pay 100%.

Shared ownership genuinely does share some risks. If a £400,000 property falls to £300,000, the 30% owner has not absorbed the full £100,000 reduction in gross asset value. The provider's retained 70% has also depreciated. Capital-value risk is shared.

What is striking is how selectively.

The government's own 2020 consultation on the new shared-ownership model stated directly that shared owners would remain 100% responsible for service charges. The National Audit Office's 2026 report says the same. Current public guidance makes the point in plainer language: shared owners pay for repairs and maintenance no matter what share they own. A 30% owner pays the full service-charge allocation for their dwelling, not 30% of it. Equity is divided by the advertised percentage. Cost is not.

The argument that the occupier should pay 100% has a straightforward logic for routine consumption services. Cleaning, concierge provision, common-parts electricity: a 30% owner occupies 100% of the flat and uses those services in full. But the argument becomes much less straightforward for capital-preserving expenditure. Roof renewal, structural repairs, lifts, communal pipework, fire-safety systems, major mechanical plant, and reserve-fund contributions all preserve the usability and market value of an asset in which the provider may retain 70% of the equity. The resident receives the immediate use benefit, but the provider retains an economic interest in the preserved asset.

A block incurs £2 million replacing its roof, lifts and communal pipework. Under the lease, Flat 20's share is £20,000. If Flat 20 is held 30:70, the resident may nevertheless be liable for the whole £20,000. The resident receives the benefit of a functioning building. But so does the provider's retained interest in a £400,000 flat. The provider's retained interest is not passive capital; the equity is preserved, and will likely appreciate, with its value depending in part on upkeep funded by the resident. When the resident eventually staircases, they buy additional equity at the current market valuation, a valuation that reflects the maintenance they have already paid for. The resident is, in a sense, maintaining someone else's investment and then purchasing it at the maintained price.

Parliament explicitly identified the cost mismatch as a problem. The 2024 Commons Committee proposed exploring leases under which shared owners would pay repair and maintenance service charges in proportion to their equity share. Government rejected an immediate restructuring, arguing that it would affect programme viability. This is important because it shows that the 30%/100% mismatch is not a campaigning invention. Parliament raised it. Government defended it primarily by reference to programme design rather than denying the mismatch exists.

The provider's defence deserves fair treatment, and it is stronger than critics usually acknowledge. Housing associations finance the unsold equity, receive rent over time rather than the entire market value upfront, face market risk on retained interests, and use shared ownership within broader affordable-housing business plans. Any argument that housing associations are economically indifferent owners sitting on a free 70% asset would be inaccurate.

But the strongest counterargument goes further. The economic bargain is deliberately hybrid. The resident has exclusive occupation of 100% of the dwelling. The rent on the unsold share is designed partly to compensate the provider for supplying the remaining capital. Repair and service-charge liability is priced into the lease structure. Requiring the provider to pay 70% of service charges would either require higher rents, greater subsidy, or lower provider receipts. Government may reasonably prefer to allocate running expenditure to the occupier because the occupier chooses to consume the dwelling.

That logic is internally coherent. But compare it with any other form of property ownership. A private landlord who retains a rental property bears the maintenance costs from rental income. They may recover those costs through the rent they charge, but they do not send the tenant a separate bill for the roof. They accept that maintaining the asset is a consequence of owning it. Housing associations retain 70% of the equity in a shared-ownership flat and receive rent on that retained share. Yet the resident, not the provider, pays the full dwelling service-charge allocation. Shared ownership therefore produces an unusual result: the provider retains most of the equity and receives rent on it, while the resident assumes the whole dwelling-level service-charge liability.

The question is therefore not whether the arrangement is contractually intelligible. It is whether calling it "shared ownership" accurately communicates the bargain to the consumer.

Insurance

Building insurance illustrates the cost-incidence problem in concentrated form. Insuring a block as a whole makes practical and economic sense. A single policy covering the structure is simpler, cheaper and more reliable than attempting to separate liability for one flat from the building it shares walls, roof and services with. The resident's four walls are covered under the building insurance; their boiler and wiring under their own contents or leaseholder's policy. That division is standard leasehold practice and not a problem peculiar to shared ownership.

But the cost allocation raises the same equity question as the roof. The building insurance protects the value of the whole property, including the provider's retained 70%. The apportioned premium is paid entirely by the party with the smaller stake. When a claim arises, the resident may bear the excess. The insurance protects an asset most of which, by value, belongs to someone else. That is not an argument against block insurance. It is a further instance of the same structural pattern: the resident funds the protection of an asset whose value accrues disproportionately to the provider.

The feedback loop

Service charges interact directly with the supposed staircase. The National Audit Office identifies service charges as reducing the disposable income available for purchasing further equity. Standard staircasing itself costs between roughly £800 and £2,568 before the price of the additional share. House-price changes and mortgage affordability then determine how expensive the next share is.

The tenure contains a plausible feedback mechanism. Mortgage plus rent plus rising service charges reduce spare income. Lower spare income reduces capacity to staircase. Inability to staircase preserves the rent liability on the unsold share.

There is an especially revealing contradiction in official affordability policy. In 2024 the government defended five-year stress testing of shared-ownership rent but declined to stress-test future service charges because they are not formula-driven and therefore cannot be forecast with sufficient accuracy. Yet those unpredictable costs form part of the resident's unavoidable housing expenditure. The government's position was, in effect: the cost is too unpredictable to forecast accurately, but the buyer remains responsible for paying it.

Policy has since moved. The 2026-36 programme requires providers to consider service-charge affordability when designing shared-ownership schemes. Revised Key Information Documents now provide projected service charges. The evolution at least reflects official recognition that service-charge affordability required greater attention than the previous framework gave it.

Meanwhile, the national evidence on shared-ownership service charges remains remarkably thin. The 2024-25 English Housing Survey reports that 61% of shared owners described their service charge as high, compared with 46% of other leaseholders. Government publishes no official service-charge inflation series for shared-ownership properties. But non-government data makes the scale of the problem clear.

The Hamptons Service Charge Index, which tracks charges on leasehold flats listed for sale across England and Wales, shows that the average annual service charge reached £2,405 in 2025, having risen 55.6% over the preceding decade. Over the same period, CPI rose 39.8%. In 2024 alone, service charges rose 11%, more than four times the 2.5% CPI increase that year. The picture is worse in London, where the average charge reached £2,801, up 64.5% over the decade. By 2025, 37% of flats had a service charge exceeding 1% of the property's value, a threshold above which some mortgage lenders will not lend.

Now compare the three recurring costs a shared owner faces. Rent on the unsold share has a formula ceiling: from October 2023, new shared-ownership leases cap annual increases at CPI plus 1%, replacing the previous formula of RPI plus 0.5%. Many existing shared owners remain on the older, higher formula, but the principle holds: rent is regulated. CPI itself is independently measured and broadly reflects economy-wide price movements. Service charges have no equivalent cap and respond to actual expenditure, including insurance, wages, materials, compliance costs and management fees, all of which have outpaced general inflation in recent years. The resident's most regulated cost is rent. Their least regulated and fastest-rising cost is service charges. And it is service charges, not rent, that the English Housing Survey excludes from its headline affordability comparison.

That comparison calculates that shared owners spend an average 23% of household income on rent and mortgage payments, versus 33% for private renters and 19% for conventional mortgagors. Shared ownership looks affordable. But the comparison excludes service charges, precisely the expenditure category at the centre of the shared-ownership controversy.

There may be sound methodological reasons for the omission. The housing-cost ratio was designed for tenures where mortgage or rent is the dominant expense. For conventional mortgagors, service charges are a small fraction of housing expenditure. For private renters, they are typically bundled into the rent or non-existent. The metric may never have been redesigned when it was applied to shared ownership, a tenure where service charges can rival the mortgage as a monthly cost.

Including service charges would necessarily raise the shared-owner housing-cost ratio and reduce the apparent affordability advantage shown by the headline comparison. Whether the omission reflects an inherited methodology or a conscious policy choice, its effect is the same: the statistic gives an incomplete picture of the unavoidable housing costs faced by shared owners.

The headline statistic cannot answer the broader question: what proportion of income does the household actually spend on unavoidable housing costs? A figure presented to demonstrate that the product works omits the cost most often cited as the reason it does not.

Pay like an owner, control like a leaseholder

Shared owners acquire a long lease, not 30% of a freehold title. The provider's retained equity and landlord role are mediated through that lease. For ordinary decoration, the resident behaves much like an owner. But the lease restricts subletting, requires permissions for structural alterations, and manages resale through provider procedures and nomination arrangements. Those restrictions have legitimate policy rationales: shared ownership contains public subsidy and is intended to meet housing need. The criticism should focus not on the existence of every restriction but on the cumulative asymmetry between owner-like liabilities and landlord-mediated decision-making.

What is at the top of the staircase? Another lease.

When a participant reaches 100% in a flat, the National Audit Office notes, the property normally becomes an ordinary leasehold interest. The Regulator of Social Housing's technical definitions expressly recognise this: fully staircased flats can remain leasehold units where the registered provider retains its own freehold or superior leasehold interest and continues responsibility for common areas and services, recovering the associated costs under the lease.

For a flat, 100% staircasing ends the shared-ownership relationship. It does not end the leasehold relationship.

The commonhold contradiction

The argument might seem academic if shared ownership were simply another form of leasehold destined to disappear with leasehold itself. But the government's proposed replacement, commonhold, exposes the same unresolved question: when equity, payment and legal ownership belong to different people, who gets the vote?

Government's objective for commonhold is to reunite homeownership with participation in building governance. Shared ownership does not fit neatly. The January 2026 draft legislation creates permitted shared-ownership leases inside commonhold. Government says shared owners should obtain core participation rights, but the provider remains the commonhold unit owner.

The ten-year initial repair period then creates a philosophical problem. During that period, the provider bears certain structural and external repair costs. Government argues that a party required to fund those liabilities should have a say in decisions generating them. That is a rational principle: those who pay should have a vote.

But that principle becomes highly revealing when set beside ordinary service charges. Shared owners can pay 100% of the service-charge allocation despite having only partial equity. Yet the draft commonhold machinery contemplated provider voting rights because the provider bears some repair expenditure during the initial period. If "those who pay should get a say" is the principle used to justify provider voting rights, why should it not also give the shared owner an unequivocal vote over expenditure that they themselves fund?

The Commons Housing Committee spotted the same problem. Its May 2026 report warned that residents could be shut out of decisions directly affecting them for years. It recommended that the final Bill allow the resident and provider to share the unit's vote.

As of August 2026, this remains unresolved. The department has missed its response deadline. Commonhold is supposed to solve a fundamental leasehold defect by making the person who pays for a building part of the body that controls it. Shared ownership is forcing government to decide which half of "shared owner" should possess that control.

The staircase

Shared ownership is not fraudulent ownership, nor is it simply renting with a mortgage attached. It is something stranger: a deliberately hybrid tenure in which different incidents of ownership have been separated and allocated to different parties. The resident acquires part of the equity, most of the day-to-day financial liability, and limited control over the machinery generating some of those costs. The provider retains capital in the property, receives rent on the unsold share, and remains landlord.

That bargain may still be worthwhile. For thousands of households, it unquestionably provides access to a home they could not otherwise buy. A smaller deposit, a manageable mortgage, a more secure tenancy than private renting can offer. Partial equity is still equity.

But if the state is going to subsidise and promote that bargain as a staircase into ownership, it should be able to answer two very simple questions.

How often do people actually climb it?

And while they are climbing, what exactly is being shared?

Sources. English Housing Survey 2024-25 shared-owner fact sheet; National Audit Office, Investigation into Shared Ownership (March 2026); MHCLG Social Housing Sales and Demolitions 2024-25; Levelling Up, Housing and Communities Select Committee, Shared Ownership (2024); Government Response to the Select Committee Report on Shared Ownership; New Model for Shared Ownership: Technical Consultation (2020); Homes England Capital Funding Guide; Commons Housing Committee, Pre-legislative Scrutiny of the Draft Commonhold and Leasehold Reform Bill (May 2026); Regulator of Social Housing, Global Accounts 2024; Housing Ombudsman, Peabody Trust 202410207; Leasehold and Freehold Reform Act 2024; Hamptons Service Charge Index 2024 and 2025.

Note. This article examines the design and outcomes of shared ownership as a national housing tenure. It is not legal advice. Leaseholders with concerns about their service charges may wish to seek independent advice or contact the First-tier Tribunal (Property Chamber).