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Shared ownership

Shared ownership in the UK is a housing scheme that allows individuals to purchase a share of a property while paying rent on the remaining share.

About shared ownership

It is designed to help people who may not be able to afford to buy a home outright to get onto the property ladder.

Under shared ownership, you typically buy a share of between 25% and 75% of the property’s value, and a housing association or a private developer owns the remaining share. You would need to take out a mortgage to purchase your share of the property and pay rent on the share you don’t own.

Here are some key points about shared ownership in the UK:

  1. Eligibility: Shared ownership is generally available to first-time buyers, although some schemes also consider applicants who have previously owned a home but can no longer afford to buy one. There are income caps and other criteria that vary depending on the specific scheme and the region.
  2. Stair-casing: Over time, you have the option to increase your share in the property through a process called “stair-casing.” This allows you to buy additional shares in the property, thereby reducing the amount of rent you pay.
  3. Costs: Besides the mortgage payments on your share, you will also have to pay rent on the remaining share owned by the housing association or developer. In addition, you’ll be responsible for maintenance costs, insurance, and other associated expenses.
  4. Resale: If you decide to sell the property, the housing association or developer usually has the right of first refusal to find a buyer for your share. They will usually market the property to other eligible buyers on their waiting list.
  5. Shared Ownership Lease: When participating in shared ownership, you will sign a lease that outlines your rights and responsibilities as a shared owner. It is important to review the terms of the lease carefully before entering into any agreement.

Shared ownership is just one of several affordable housing options available in the UK. Other schemes include Help to Buy, Rent to Buy, and Shared Equity. Each scheme has its own eligibility criteria and rules, so it’s essential to research and understand the specific details and requirements of the scheme you are interested in.

If you are interested in shared ownership, please contact one of the Spitalfields Housing Association housing options team members.