What is Shared Ownership?

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Shared Ownership is a government-supported scheme built to give first time buyers a helping hand on the housing ladder. Home buyers pay for part of the home while renting the remaining ‘share’ with a housing association. This makes it an ideal opportunity for people who want a home but can’t yet afford to buy one on the open market.

If you are a first time buyer and do not currently own your home, shared ownership gives you the opportunity to purchase a share in a new build or resale property.

Shared Ownership Explained

Watch our Shared Ownership explainer video for a quick visual break-down on how Shared Ownership works and how it can help you get on the property ladder.

How does Shared Ownership work?

You as the purchaser would pay a mortgage on the share that you own and then pay rent on the remaining share, to the housing association that sold you the property. The deposit required for shared ownership is much lower and therefore more accessible for so many people. You only need a mortgage for the share you are purchasing and not the full property value.

To learn how it all works, look at our 6-step guide to home ownership through Shared Ownership.

  1. Register with your local registered provider (RP) and local homebuy agent
  2. Gain an independent financial assessment from an Independent Financial Advisor
  3. Once you have your application in place and an understanding of affordability, apply for a property that you want to buy
  4. Reserve your property
  5. Await your final mortgage offer
  6. Exchange and complete!

There is often a misconception that Shared Ownership means you share with other people, whereas the term ‘share’ refers to the ‘share’ in a property. Shared ownership properties can be bought either as an individual or as a couple, and you can find more details below.

How can
I apply for
Shared Ownership?

  1. Find a property you like that offers shared ownership – see our ‘find a home’ page for the most conclusive list of properties
  2. Apply through the local homebuy agent or housing association offering this property
  3. They will guide you through the rest of the process

It really is that simple! For even more answers, please see our Frequently Asked Questions section below.

Key
Facts

  • You will need to take out a mortgage to pay for your share of the home’s purchase price
  • Shared Ownership requires a smaller deposit, as you only need to find the deposit for the share you buy
  • You will need a smaller mortgage, as you are only buying the percentage you can afford
  • There will also be a service charge on the property, so it is important to check what it is likely to be
  • Shared ownership homes are always leasehold
  • You can sell your home at any time. The housing provider will have eight weeks to find you a buyer and during this time you cannot sell your home privately or through an estate agent. If it finds a buyer, it will usually charge you an administration fee, so you should ask whether this is a fixed price. If it cannot find a buyer after eight weeks, you will be able to sell your home privately or through an estate agent
  • Housing associations offer resale properties, which have already been bought through shared ownership in the past, and the owners are looking to sell their share and move on. You buy the share they are selling and pay a subsidised rent on the remainder. It is unlikely that you can buy fewer shares than the current owner has, but it may be possible to buy more. Remember that these homes will obviously be older

Why buy a Shared Ownership Home?

Buying a home in the current market is far from easy, but Shared Ownership gives you more breathing room to buy a property that would otherwise not be affordable.

If you want to buy a home but are worried about money, Shared Ownership is the way to go. As you only need a smaller mortgage, the initial deposit that you pay is smaller. Though you will have to keep up with rent and mortgage repayments, the smaller deposit will help speed up the process.

Is Shared Ownership good for first-time buyers?

Shared Ownership is perfect for anyone looking to get their housing journey started. Buying a house for the first time is a tough task, particularly if you are still learning the ins and outs of house-buying.

Shared Ownership helps to take the weight off your shoulders by dramatically reducing the deposit you pay and giving you a fast-track ticket to your new home.

As well as being affordable, Shared Ownership properties are often private developments. This means that it is easier than ever to get a swanky home in a sought-after area, without breaking the bank.

Frequently
asked questions

As a home-buying newbie, your mind is probably racing with various questions about the process. For starters, what does Shared Ownership even mean? Don’t panic – we might have the answers you need.

What is Shared Ownership?
Shared Ownership is a house buying scheme that allows individuals to purchase a portion of a property while renting the remaining share. It provides an accessible path to homeownership, especially for first-time home buyers. Over time, buyers can increase their ownership share, potentially owning the entire property. Explore Shared Ownership further or begin your property search.
How does Shared Ownership work?
Shared Ownership offers a unique opportunity for first-time buyers to acquire a stake in either a new build house or flat, or a resale property. Here’s how it works: Partial Ownership: Purchasers buy a share of the property and pay a mortgage on that portion. Deposit and Mortgage: You put down a deposit of at least 5% of your stake and secure a mortgage to cover the remaining portion. Subsidised Rent: The remaining share is rented from a housing association at a reduced rate. Lower Deposit: Since the mortgage is only for the purchased share, the deposit required is typically lower than outright purchase. Staircasing: Over time, buyers can increase their share, potentially owning the entire property. No Rent at 100%: At full ownership, no rent is paid—only mortgage, service charges, and ground rent. Explore Shared Ownership further or begin your property search.
What properties are for sale with Shared Ownership?
Shared Ownership provides some of the very best new build properties in the market today. You have a choice to either buy a new build house or apartment, or you can buy what is called a ‘resales’ unit from an existing homeowner, who is looking to sell their home through the housing association that they originally bought it from. Explore Shared Ownership further or begin your property search.
How do I buy more shares in my property?
You can buy more shares in your property through what is called staircasing. Start by buying 10% increments with the theory that one day you can have 100% ownership of your home. Explore Shared Ownership further or begin your property search.
What is staircasing?
Staircasing is the term used to buy more shares in your shared ownership property. You can buy an additional percentage of your property at any point. Normally the minimum extra percentage you can buy is 10% at a time. Most people try to buy them in larger chunks as there are fees that you have to pay each time, so it can become quite expensive if you buy smaller percentages at a time. When you have staircased to 100% you will no longer have to pay any rent to the housing association. For more detailed information read 'what is staircasing'.
What is a Shared Ownership property?
Housing associations build shared ownership properties to address the pressing need for affordable housing options, particularly for individuals and families who may struggle to purchase a home on the open market due to financial constraints. By offering shared ownership schemes, housing associations can provide an alternative pathway to homeownership, enabling more people to access secure and stable housing. These properties are typically new builds: Meeting Demand: New construction allows housing associations to increase the supply of affordable housing in areas where demand is high. Building new properties allows the tailoring design and location to meet the specific needs of potential homeowners. Quality Standards: New build properties often meet higher quality and safety standards compared to older homes. This ensures that buyers have access to modern, energy-efficient homes with lower maintenance requirements. Long-Term Viability: New properties are less likely to require immediate repairs or renovations, reducing the risk of additional costs for both the housing association and the homeowners. Reselling homes within the shared ownership scheme is an integral part of the process: Meeting Changing Needs: As homeowners' circumstances change over time, they may decide to sell their shared ownership property. This could be due to factors such as needing more space for a growing family or relocating for work. Increasing Accessibility: Reselling shared ownership homes allows new buyers to enter the scheme, ensuring that the benefits of affordable homeownership continue to be accessible to a wide range of individuals and families. Providing Equity: When homeowners sell their share of the property, they can potentially realize equity from any increase in the property's value. This equity can then be used to finance a larger share of a new property or to invest in other aspects of their lives.
What is a Shared Ownership mortgage?
Shared ownership mortgages offer a unique pathway to owning a home. Here's a straightforward breakdown: Choose Your Share: Decide on the portion of the property you can afford, typically with guidance from the housing association. Deposit and Mortgage: Put down a deposit, usually 5-10% of your chosen share, and secure a mortgage for the remainder. Rent on the Unowned Share: While you own your portion, you'll pay rent on the part still owned by the housing association. Now, onto the types of shared ownership mortgages: Fixed-rate Mortgage: The interest rate remains constant for an agreed period, typically 2 to 5 years, providing stability in your monthly repayments. Variable Rate: Interest rates fluctuate based on the lender's decision, either tied to the Bank of England base rate (tracker) or the lender's standard variable rate.