Shared Ownership
Struggling to afford a new home? Find out about Shared Ownership - a government scheme that allows you to buy a share of a property and pay rent on the rest.
Shared Ownership at a glance
Deposit needed
Minimum 5% of the share of the property you're buying.
Ownership
Part-buy, part-rent.
Household income required
Less than £80,000 (£90,000 in London).
Availability
England only (but there are similar schemes in Scotland, Wales and Northern Ireland).
What is Shared Ownership?
Shared Ownership is a government scheme that offers you the chance to buy a share of a property from a housing association, a non-profit-making body that provides homes.
You can buy a share between 10% and 75% of the home’s full market value, and pay rent on the rest.
Because you only own a part of the property, you can buy it with a smaller deposit and mortgage. A smaller mortgage means smaller repayments, but you’ll also need to pay:
rent on the share of the property you do not yet own
monthly ground rent and service charges, for example to cover maintenance of communal areas.
Shared Ownership homes can be new-build houses or flats, or existing properties. All Shared Ownership properties are leasehold, even houses.
How does Shared Ownership work?
When you buy a Shared Ownership home, you decide what stake in the property you can afford to buy from the housing association.
You put down a deposit of at least 5% of your stake and take out a mortgage to cover the rest. You then pay rent on the part you do not own.
You can increase the share you own in the property, through a process known as staircasing, until you own 75% of the property, or in some cases 100%. Not all housing associations let you get to 100%, so be sure to check first.
There’s a legal cost every time you staircase so it may make sense to buy bigger chunks. Plus, some housing associations have a limit on how many times you can do it.
The best way to check if a home qualifies for Shared Ownership is to use our Shared Ownership filter. It's always worth double-checking with the provider or estate agent when you make an enquiry about the home too.
Am I eligible for the Shared Ownership scheme?
To be eligible for Shared Ownership you must:
Have an annual household income of less than £80,000 (or £90,000 in London), and
Be unable to afford a home that meets your needs because the mortgage payments and deposit would be too high
One of the following must also be true:
You’re a first-time buyer
You used to own a home but cannot afford to buy one now
You’re forming a new household - for example, after a relationship breakdown
You already use the Shared Ownership scheme and you want to move
You own a home and want to move but cannot afford a new home that meets your needs
You might also have to show that you live in, work in, or have a connection to the area where you want to buy the home.
The pros and cons of Shared Ownership
The pros
You only need a deposit for the portion of the home you're buying - not the price of the entire property
Your mortgage may be more affordable as you'll only need to borrow on the share of the home you're buying
The smaller downpayment means you could buy a house sooner than you would otherwise
It helps those on a lower income get on the property ladder
You can increase your share in the property as and when you can afford it
The scheme is available on lots of different types of properties, including new-build homes and flats and existing homes (through a Shared Ownership resale scheme)
You can use the scheme to buy a home that meets your specific needs if you have a long-term disability, such as a ground floor flat
The cons
Shared Ownership properties are leasehold, rather than freehold, so you will not own the land the property is on
Your landlord can increase the amount of rent you pay on the portion of the property you do not own (although there are limits to these rises)
You have to pay a service charge that comes with the property regardless of how big your stake is. You may have to pay ground rent too
Buying more of the property over time comes at a cost
You may lose your home and the money you put into it if you don't pay your rent or you break the terms of the lease
When you come to sell, you may have to do it through the Shared Ownership scheme rather than on the open market
Find Shared Ownership properties for sale
How Shared Ownership compares with Deposit Unlock
| Buying scheme | Shared Ownership | |
|---|---|---|
| Overview | Allows buyers in England to buy part of a property and pay rent on the rest. | Gives you access to competitive mortgage rates with a 5% deposit when buying a new-build home |
| Key benefits | You need a smaller deposit as you're buying between 10-75% of a property. | Competitively priced mortgage products and makes buying a new home more affordable. |
| Deposit | At least 5% of your share of the property. | 5% of the property's total price |
| Requirements | Your annual household income must be less than £80,000 (£90,000 in London). | Open to first-time buyers and home movers buying new-build properties up to £833,250 |
| Ownership | Own up to 75% of the property value once your mortgage has been repaid. You can build this share up gradually. | You own 100% of the property |