Buying a shared ownership property? This is what you need to know

With the cost of living on the rise, you may be looking for ways to save money when purchasing a house. The Shared Ownership Scheme allows you to purchase a share of your home and pay rent on the rest, helping you to get on the property ladder.

What is shared ownership?

Shared ownership allows you to buy part of a property from a housing association or landlord and pay rent on the remaining share. This means you only need a mortgage for your share of the purchase and the deposit will usually be significantly lower than when buying a property outright.

You will:

• Buy a share worth between 10% and 75% of the home’s full market value
• Pay rent to the landlord, local authority or housing association on the remaining share they own
• In most cases, pay monthly ground rent and service charges as shared ownership properties are sold on a long lease

How do I buy a shared ownership home?

To buy a shared ownership home, you can either take out a mortgage on your share or pay upfront with savings. You will also need to pay a deposit, which is usually between 5% and 10% of the share you buy.

Can I buy more shares?

Once you have lived in your shared ownership home for a certain period, you have the choice to purchase further shares of the property. This process is called ‘staircasing’.

Can I ever fully own a shared ownership property?

Yes. If you choose to ‘staircase’ your property, you can usually increase your shares to 100%, meaning you then fully own your shared ownership home. If this is the case, you will no longer pay any rent, only the mortgage along with any service charges and ground rent.

Some properties may have restrictions on the amount you can staircase; for example, there could be a stair casing cap of 80%. It is important that you check the terms of the lease and ask a conveyancing solicitor who specialises in shared ownership to advise you on the next steps.

Can I sell a shared ownership property?

You can sell your shared ownership home at any time, however much of it you own. However, there are rules and restrictions around who can sell the property and whether it can be advertised on the open market.

If you want to sell your shared ownership property and you do not own 100% of it, the housing association or local authority has the right to buy it through ‘first refusal’. They also have the right to choose the buyer of your home.

If the time has come to sell your shared ownership home, or you are interested on buying a home that is part of the scheme, our conveyancing solicitors can guide you through the entire process and ensure everything runs smoothly.

We provide a No Purchase – No Legal Fees* scheme for first time buyers. To find out more about click here.

We also provide free initial advice where needed and quotes for conveyancing through our free instant conveyancing quote calculator.

Unlike other law firms, our Law Society accredited conveyancing team pride themselves on providing a client focussed experience with complete fee transparency. To instruct our team for your home purchase and/or sale please do not hesitate to contact us.