Letter from the Housing Minister to mortgage lenders on subletting for shared owners  

As shared ownership homes delivered through the Affordable Homes Programme are developed with government grant funding, subletting is restricted in all but ‘exceptional’ circumstances. This restriction is in place to prevent homes built with public funds from being used for commercial gain.

To improve the options available to shared owners in homes delivered through the Affordable Homes Programme, the government has amended its grant funding guidance to make it clear that issues of building safety should be treated as an exceptional circumstance. This will allow shared owners to sublet their homes, with the agreement of their freeholder.

However, the government recognises that in order to sublet their homes, shared owners also require the permission of their mortgage lender. The Minister for Housing, the Rt Hon Christopher Pincher MP, has therefore written to mortgage lenders encouraging them to accept subletting applications from affected shared owners.

To reduce the costs involved, the Minister for Housing has also requested that mortgage lenders consider extending the period a shared owner can sublet their home before needing to convert to a buy-to-let mortgage. This period is often referred to as the consent-to-let period. To further reduce fees, the Minister for Housing has also asked mortgage lenders to waive any premium associated with the extension of the consent-to-let period.