Shared ownership is an alternative to renting and full ownership. It is particularly suitable for people with a regular income who want to buy their own home but cannot afford to do so outright.
With shared ownership you buy a share of your home and pay rent on the remainder. Shared ownership does not mean that you share your home with someone else.
Shared ownership is usually arranged through Registered Providers (RPs) like Housing Solutions. They are non-profit making organisations that provide good quality affordable homes for rent and shared ownership.
The total monthly costs of the rent and mortgage should be lower than the cost of a mortgage needed to buy 100% of the same home. This is because shared ownership is often supported by government money which reduces the level of rent to be charged.
be first time buyers, although some applicants who own or have previously owned a home may be eligible. This includes people who have lost a home through a relationship breakdown and shared owners whose family has grown and they need a larger home but who are still unable to afford to buy outright.
A minimum income level will be required for each home we sell. This will vary depending on the size of the home and the location. However, if you can afford to buy the property outright you will not qualify for shared ownership. All applicants are assessed by an Independent Financial Advisor , approved by the HCA, who will calculate how much you can afford to spend on buying a home without struggling to make ends meet.
I have a poor credit rating—am I still eligible?
Housing Solutions cannot accept your application if you have had arrears of rent in the past six months or if you have outstanding County Court Judgments against you or other outstanding credit issues, such as unsatisfied defaults. Please telephone us to discuss this issue.
In some areas you will also need to register with your local authority and we will need a nomination from the Local Authority before we can sell you a shared ownership property.
What sort of initial costs should I expect to budget?
Reservations fee – We charge a £500 reservation fee, this goes towards the purchase price of the share of the property you are buying.
Mortgage arrangement fee – Some lenders will charge you an administration fee and the cost may vary from lender to lender.
Valuation fee – Lenders require a Valuation fee. Your lender will arrange this for you. The cost may vary from lender to lender and is also based on the purchase price of the property.
Legal fees and stamp duty – You will need to instruct a solicitor to act on your behalf. The solicitor will give you an estimate of the legal fees you will have to pay including their own fee, stamp duty, land registry fees and other associated costs.
Your responsibilities and ongoing costs?
You will be responsible for all repairs and maintenance to your property, just like an owner-occupier. You will need to make sure that you allow a sufficient budget for the upkeep of your property.
You will be responsible for all utility bills such as gas, electric, council tax, water rates, contents insurance etc. You should include these costs in your monthly budget.
Your monthly mortgage repayments will depend on the size of your mortgage and interest rates.
You will pay an affordable rent on the share of the property you do not own. Rents increase on April 1 each year. Details of how rent increases are calculated are set out in your lease. Rents are paid monthly in advance by Direct Debit. Insurance We insure the building and recover the cost of this through service charges. You will need to take out a policy to insure your personal possessions and the contents of your home from the date that you move in.
In some cases, especially if you buy a flat or a maisonette, you may have to pay ground rent and service charges in line with the lease. Service charges will normally cover the costs of maintaining the shared parts of the building, any gardens and car parking areas. We will give you details of these before you buy.
A year after you buy the property you will be able to buy more shares in your home if you wish. You must buy at least 10 per cent each time you choose to increase your share. This is called staircasing. The value of any additional shares you buy is based on the market value at the time you buy the shares.
If you choose to staircase to 100 per cent the lease agreement between us will no longer exist and we will transfer the freehold title to you, unless you have bought a flat from us and then you will continue as a leaseholder. If you increase your share in the property your rent will decrease proportionally. Some local authorities will restrict how much you can buy, especially in rural areas so the homes are always available to local people. We will let you know about any restrictions before you buy.
You must get written confirmation from our Home Ownership Team before you carry out any work. You may also need to get approval from your mortgage lender, as well as any legal permission you need, for example, planning permission or building regulations .
Your lease will tell you if you can keep pets in your home. If you live in a house there are not usually any restrictions. If you live in an apartment you are unlikely to be able to keep a pet.
No. Government money goes into affordable home ownership schemes, so we have to control who benefits from it. Also, if you have a mortgage on your home, your lender will probably be concerned if you let it to someone else.
If you hold the lease in a single name or as joint tenants, the shared ownership lease can be passed on or sold in line with your will or the law of intestacy (dying without making a will). If you hold a joint tenancy, the lease automatically passes to the survivor.