Shared Ownership

Shared Ownership helps people who cannot afford to buy a home outright on the open market. It's as straightforward as the name suggests - you buy a share of the property and pay rent to a housing association on the proportion of the share you don't own.

How much? The price will be based on the open market (normal) value of the property. The amount or share you buy varies with the property and your circumstances. It can be as low as 25% in some cases, but is typically 40% or 50%.

Arranging a mortgage - unless you have enough savings to pay for your share you must be able to get a mortgage. A mortgage is a loan from a bank or a building society which you repay monthly over a fixed period. Some mortgage lenders are more used to lending on shared ownership properties than others, so it's worth finding out their viewpoint and the type of mortgage you can afford.

Rent - you can pay monthly and the amount depends on the share you own. As housing associations receive a grant from the Government to enable them to make rent lower than the level you would pay for a mortgage or renting privately. Your rent payment goes toward the cost of the loan that paid for the share bought by the housing association.

Eligibility - the most important criteria is that you must be able to raise the purchase price of the share on offer and be able to afford all the monthly payments. You would not qualify if you can afford to buy a suitable home on the open market or if you already own a home. If you have a County Court Judgement out against you, or you are in rent arrears, you are unlikely to be able to purchase a shared ownership property. You must also have indefinite leave to remain in the UK.

Demand and priorities - there is usually a high demand for the schemes, so when properties become available, applicants are prioritised according to our current points scheme.

Ongoing costs - as well as your monthly payments, like any other homeowner, you will have to pay all the household bills, including council tax. You will also have to pay the housing association a monthly 'service charge' to cover the cost of insuring the building and, if it's a block of flats, the costs of repairing, cleaning, gardening and decorating any communal parts. The service charge varies from property to property and this information will be provided by the housing association before you buy.

Who to apply to - Shared Ownership is generally provided by housing associations, trusts or societies (collectively known as Registered Social Landlords). These are non-profit making organisations that work in partnership with the Government and local councils to provide affordable housing.

Need to sell? If circumstances change you will need to be free to adapt with them. You may need to move in connection with your work or for other personal reasons. If you decide to sell your home the housing association will try to find a buyer for your share from their waiting list but this is not guaranteed.

Extra shares - after you have been in the property for a length of time (usually 12 months) and if you find your financial situation improves, then you can buy more shares by a process called "staircasing". In most cases you can buy right up to the point where you own the property outright. As you buy more shares of the property the rent you pay to the housing association will decrease. Each time you want to buy another share, the property is re-valued and you buy the share at the current market value.

Rights and Responsibilities - when you buy a shared ownership property you enter into a Lease agreement, which is usually 99 years long. Your solicitor will explain all the important aspects of this lease, but the main areas covered are what repairs and other outgoings you and the association are responsible for, how the rent and service charge will be calculated and paid, and how you can buy further shares to sell the property. Essentially you have all the same rights and responsibilities of any homeowner and are responsible for all repairs to your home, from dripping tap to replacing a boiler, although your housing association is responsible for repairs to common parts in a development.

Solicitors - you will need to appoint a solicitor to handle the legal side of buying a property. It is strongly recommended that you use a solicitor who is experienced in shared ownership as invariably this saves time and money.

Homes for sale - just like any other home, you'll find new and old properties that range from flats to houses are usually within a development of other shared ownership properties.

Improvements and adaptations - you can make improvements and adaptations but you should always consult with your housing association first. Most improvements, like a new kitchen or new flooring, can go straight ahead. If the improvements are structural you must seek permission from housing association, who will check the works are safe and have the necessary planning permission. If your improvements add value to the property, this will be taken into account when you sell the property or buy extra shares so that you get the full benefit of them.

Purchase costs - just like any other property buyer you'll need to cover the costs of legal fees, surveys, and stamp duty. Just as a guideline, you should have savings or access to around £3000-£3500. It's worth asking a solicitor in advance what the total cost is likely to be.

To receive information on any shared ownership properties that become available you need to be on our housing register.  The Housing Register Application Form can be downloaded from the Housing Allocations page.