On 15 April 2026, the Ministry of Housing, Communities and Local Government (MHCLG) wrote to all registered providers of social housing in England to highlight important changes affecting shared ownership, particularly in light of the Renters’ Rights Act 2025. The letter, accompanied by an information note, signals a clear expectation that providers should review their policies, procedures, and lease documentation to ensure continued compliance.
While the government has reaffirmed its commitment to shared ownership as a key route into home ownership, it has also emphasised the need for greater transparency, fairness and customer protection, particularly where shared ownership intersects with the private rented sector.
The government's latest guidance signals significant changes for shared ownership schemes following the Renters' Rights Act 2025. This article explores what registered providers need to know about subletting, lease drafting and policy reviews to remain compliant.
A central point of the letter is that shared ownership leases ceased to fall within the assured tenancy regime on 27 December 2025. This change arises directly from the enactment of the Renters’ Rights Act 2025 which altered the legal framework that has historically applied to shared ownership subletting arrangements.
From 1 May 2026, the tenancy reform measures affecting the private rented sector brought in by the Act have removed fixed term assured tenancies and abolished section 21 ‘no fault’ evictions. Although shared owners are owner occupiers for many purposes, MHCLG recognises that subletting remains an important safety net for some households, particularly those affected by building safety remediation who are temporarily unable to sell.
The letter makes clear that MHCLG expects registered providers to continue to permit subletting at up to market rent where there is a genuine need, subject to appropriate safeguards and time limited arrangements. Registered providers are encouraged to review their subletting policies now, ensuring they align both with the new legislative framework and with forthcoming amendments to the Capital Funding Guide.
For many registered providers, this will require careful consideration of:
how subletting consent is documented,
whether existing shared ownership leases adequately reflect the amended regime; and
how to manage ongoing subtenancies once assured tenancy concepts no longer apply.
Beyond the immediate impact of the Renters’ Rights Act, the letter also highlights broader changes under the Social and Affordable Homes Programme. These include updated expectations around affordability, clarity of costs, and the confirmation that permitted rent increases will not fall below CPI + 1% for the lifetime of the programme.
The removal of the right to shared ownership as a condition of new grant funding, and increased flexibility around initial equity shares, may also influence future scheme viability and lease drafting decisions.
MHCLG’s message is that proactive action with regards to existing shared ownership models is expected. Registered providers should therefore:
review shared ownership lease templates and precedents,
assess policies on subletting and customer communications,
monitor forthcoming amendments to Homes England guidance; and
ensure internal teams understand the changed legal status of shared ownership. subtenancies.
Taken together, the letter represents an important moment for registered providers to future proof their shared ownership portfolios while continuing to support customers through an evolving regulatory landscape.
For further information please contact our real estate team, or get in touch directly with Tanya Edmonds, Tillie Clark or Derek Moore.
