Shared ownership schemes are provided through housing associations. You buy a share of your home (between 25% and 75% of the home’s value) and pay rent on the remaining share.
You will need to take out a mortgage to pay for your share of the home’s purchase price. Many mortgage lenders will lend 100% of the share being purchased, subject to individual criteria being met, so this can be a great way to buy if you have little or no deposit.
Requirements
You can buy a home through shared ownership if:
- Your household earns £60,000 a year or less
- You’re a first-time buyer – or you used to own a home, but can’t afford to buy one now
- You rent a council or housing association property
Older people
You can get help from another home ownership scheme called ‘Older People’s Shared Ownership’ if you’re aged 55 or over.
It works in the same way as the general shared ownership scheme, but you can only buy up to 75% of your home. Once you own 75% you won’t have to pay rent on the remaining share.
People with disabilities
Home Ownership for People with Long-Term Disabilities (HOLD) can help you buy any home that’s for sale on a shared ownership basis if you have a long-term disability.
Buying more shares (Staircasing)
You can buy more shares in your home any time after you become the owner. This is known as staircasing.
The cost of your new share will depend on how much your home is worth when you want to buy the share. If property prices in your area have gone up, you’ll pay more than for your first share. If your home has dropped in value, your new share will be cheaper.
The housing association will get the property valued and let you know the cost of your new share. You’ll have to pay the valuer’s fee.
Selling your home
If you own 100% of your home, you can sell it yourself.
When you put it up for sale, the housing association has the right to buy the property back first. This is known as ‘first refusal’ and the housing association has this right for 21 years after you fully own the home.
If you own a share of your home, the housing association has the right to find a buyer for it.