New Model Shared Ownership and 1% Staircasing — What Changed in 2021

The 2021 Shared Ownership Reform

In November 2021, the government introduced a revised "new model" for shared ownership as part of its Affordable Homes Programme. The new model applies to shared ownership properties funded through the programme from that point forward. Its most significant change was the introduction of the right to buy additional shares in 1% tranches during the first 15 years of ownership.

Under the old model — which still applies to properties developed before the new model took effect — the minimum staircase tranche is 10%. This meant that to increase from a 25% share to a 35% share, a buyer had to buy the full 10% in one transaction, which for many properties represents a significant lump sum.

How 1% Staircasing Works Under the New Model

Under the new model, shared ownership buyers can purchase as little as 1% of the property's value per year during the first 15 years. The price of each 1% tranche is calculated using a RICS valuation — just as with conventional staircasing — but the housing association is required to subsidise the costs of these small-tranche transactions. Specifically, the housing association must:

• Pay for the RICS valuation
• Cover their own legal costs
• Waive any administration fees

This makes 1% staircasing considerably more accessible. A buyer in a £300,000 property can buy a 1% tranche — worth £3,000 — without needing to fund thousands of pounds in associated costs.

Who Does the New Model Apply To?

The new model applies to shared ownership homes developed with Homes England grant funding from the 2021–26 Affordable Homes Programme onwards. In practice, this means:

• Most newly built shared ownership properties delivered from late 2021 onwards are new model.
• Properties developed under earlier programmes (e.g., 2016–21 AHP) follow the old model with a 10% minimum tranche.
• The specific terms of your lease will confirm which model applies to your property. Look for the 1% staircasing right in the lease, or ask your housing association directly.

It is important to note that the new model does not apply retrospectively to existing shared ownership leases signed before the new model was introduced.

After the First 15 Years

The 1% annual staircasing right applies only during the first 15 years of ownership. After 15 years, the minimum tranche reverts to 10% under the new model — the same as the old model. This means buyers who want the flexibility and lower-cost incremental staircasing should plan to use those early years strategically.

Checking Whether Your Property Is New Model

If you are unsure whether your shared ownership property falls under the new model, there are several ways to confirm:

1. Check your lease. The right to buy 1% tranches should be explicitly stated.

2. Ask your housing association. They should be able to confirm which programme your property was funded under.

3. Check your welcome pack. Many housing associations provide a summary of key lease terms when you move in.

Modelling 1% Staircasing

Even buying 1% per year can have a material impact on your rent over time. Because rent is calculated as a percentage of the unsold share, each 1% tranche you buy reduces the unsold share — and therefore reduces your rent. Use our [Shared Ownership Calculator](/shared-ownership-calculator) to project how annual 1% purchases would reduce your rent and increase your equity stake over 5, 10, and 15 years. The compounding effect of small, regular tranches can be surprisingly significant.

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