What Is Shared Ownership?

*This is a collaborative post on shared ownership

Shared ownership, commonly known as “part-buy, part-rent,” is a government-supported scheme designed to help individuals get onto the property ladder. With the conclusion of Help to Buy, Shared Ownership has become the primary choice for First Time Buyers. This scheme allows you to purchase a percentage of a new home while paying rent on the remaining portion. This can potentially make it easier to afford a larger property than you could on the open market. 

The share of the property you can purchase depends on your location: 

• England: Shares available range from 10% to 75% of the full market value.
• Scotland: You can buy a 25%, 50%, or 75% share.
• Wales: Shares are offered between 25% and 75% of the home’s value.

Shared Ownership properties are sold through housing associations or local councils and can be either new builds or resales of existing Shared Ownership homes. To proceed, you will need a deposit and a mortgage to cover your share. The remaining portion remains under the ownership of the housing association or council. So you will pay rent on this share—typically capped at up to 3% of its value. 

Even though the housing association or council retains a stake in the property, you will be the leaseholder, holding the lease in your name. As a leaseholder, you are responsible for the upkeep and maintenance of the interior, including plumbing, electrical systems, and general repairs. The housing association or council, on the other hand, is responsible for maintaining and repairing the exterior, shared spaces, and the building’s structure where applicable. 

Before committing to Shared Ownership, it’s crucial to consider all costs involved, including the deposit, mortgage, rent, and service charge. Carefully reviewing the lease agreement will help you understand your responsibilities as a leaseholder and the housing association’s role in property management, enabling you to make an informed financial decision. 

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 needed to buy a suitable home outright. In Wales, the income threshold is lower, with eligibility restricted to households earning less than £60,000 annually. 

To qualify, you must meet specific criteria, such as: 

• Being a first-time buyer, or
• Having previously owned a home but now being unable to buy outright, or ● Moving from one Shared Ownership property to another, or

Shared Ownership 

• Forming a new household (e.g., after a relationship breakdown), or
• Currently owning a home but needing to move and being unable to afford a property outright.

Additionally, applicants must have no outstanding credit issues, so ensuring your finances are in good order before applying is essential. 

Since eligibility requirements vary by country, it’s important to check the specific criteria in your region before starting the application process. 

You can explore a wide range of Shared Ownership properties at newhomesforsale.co.uk.