collaborative post | Shared ownership, often referred to as “part-buy, part-rent,” is a government-backed scheme designed to assist getting onto the property ladder. With the end of Help to Buy, Shared Ownership has become the primary option for First Time Buyers. This scheme enables you to purchase a portion of a new home while paying rent on the remaining share, potentially allowing you to afford a larger property than you might on the open market.
The percentage of the property you can purchase varies based on location:
- England: You can buy shares ranging from 10% to 75% of the full market value.
- Scotland: You can purchase a 25%, 50%, or 75% share.
- Wales: Shares are available between 25% and 75% of the home’s value.
Shared Ownership properties are sold through a housing associations or local council and can be either new builds or resales of existing Shared Ownership homes. To proceed, you’ll need a deposit and a mortgage to cover your share of the property. The housing association or council retains ownership of the remaining share, on which you will pay rent—typically capped at up to 3% of the value of their portion.
Although the housing association or council retains a share, you will hold the lease, making you the official leaseholder of the property. As a leaseholder, you are responsible for maintaining and repairing the interior of the home, including plumbing, electrical systems, and general upkeep. Meanwhile, the housing association or council is responsible for maintaining and repairing the exterior of the property, including shared spaces and, if applicable, the building’s structure.
Before committing to Shared Ownership, it is important to understand all associated costs, such as the deposit, mortgage, rent, and service charge. Reviewing the lease agreement thoroughly will help you understand your responsibilities as a leaseholder, as well as the housing association’s role in managing the property. This will enable you to make an informed decision and plan your finances effectively.
Eligibility
In England, the Shared Ownership scheme is available to households with a combined income of less than £80,000 per year (or £90,000 in London). It is designed for individuals and families who cannot afford the deposit and mortgage payments required to buy a suitable property outright. In Wales, the income threshold is lower, set at a combined annual income of less than £60,000.
To qualify, you must also meet certain criteria, such as:
- Being a first-time buyer, or
- Previously owning a home but now unable to buy outright, or
- Moving from one Shared Ownership property to another, or
- Establishing a new household (e.g., after a relationship breakdown), or
- Currently owning a home but needing to move and unable to afford a property outright.
Additionally, applicants must have no outstanding credit issues. Ensuring your finances are in good order before applying is essential.
Since eligibility criteria vary by country, it’s important to check the specific requirements in your region before beginning the application process.
You can find a huge selection of Shared Ownership properties at newhomesforsale.co.uk
