Shared Ownership – New Build & Resale

Shared Ownership is a government-supported affordable home ownership scheme available on both new build and pre-owned (resale) properties.

It is designed to help eligible individuals purchase a share of a home where buying outright on the open market may not be possible. This may include first-time buyers or those who previously owned a home but are unable to afford to buy again.

There is also a Shared Ownership option available for people aged 55 and over in some developments (known as Older Persons Shared Ownership).

How Shared Ownership Works

Shared Ownership is a part buy / part rent scheme.

You purchase a share of a property’s market value and pay rent on the remaining share to a housing association, local authority or developer.

On many new build Shared Ownership homes, the initial share available may range from 10% to 75% of the full market value, depending on the scheme and funding arrangements for the development.

When purchasing a resale Shared Ownership property, you would normally buy the share owned by the current leaseholder (or a higher share, subject to housing provider approval).

Mortgage and Deposit

To purchase your share, you will usually need to arrange a mortgage and provide a deposit based on the share you are buying rather than the full market value of the property.

Deposit requirements vary by lender and individual circumstances, but are typically based on a percentage of the share being purchased.

In addition to your mortgage payment, you will normally pay:

• rent on the share you do not own
• a service charge
• and, where applicable, an estate charge

Service charges may include the cost of maintaining communal areas, buildings insurance and contributions towards long-term maintenance funds.

Rent and Ongoing Costs

Rent is payable on the share of the property that you do not own.

The way rent is calculated will depend on the terms of your lease and housing provider. Rent and service charges are usually reviewed annually.

Buying Additional Shares (Staircasing)

If you purchase a property through Shared Ownership, you may be able to buy additional shares in your home in the future. This process is known as staircasing.

As you increase the share you own, the rent you pay on the remaining share may reduce.

The rules for staircasing will depend on your lease and housing provider. Some leases may allow you to staircase to 100% ownership, although this is not always the case.

There may be fees associated with buying additional shares, and you should seek independent legal advice before proceeding.

Lease Terms

New build Shared Ownership properties are typically sold on a long lease.

With resale properties, the remaining lease term will be based on when the lease was originally granted. Mortgage lenders may apply minimum lease term requirements.

You may wish to seek independent legal advice regarding lease terms and any potential lease extension.

Eligibility

General Shared Ownership eligibility criteria include:

• You must be aged 18 or over
• Your household income must usually be no more than £80,000 per year (or £90,000 in London)
• You should not own another property at the time of purchase
• You must be able to demonstrate that you can afford the costs and regular payments involved

Eligibility criteria and prioritisation may vary depending on the housing provider and local planning requirements.

Priority Groups

Shared Ownership homes are allocated in accordance with government guidance and local planning obligations.

Priority may be given to:

• existing social housing tenants
• those who live or work within the local authority area
• or members of the Armed Forces community

Availability may widen after an initial marketing period.

Finding Shared Ownership Properties

Shared Ownership properties may be advertised through housing providers and affordable home ownership portals.