Shared Ownership
IntermediateShared ownership is a UK housing scheme in which a buyer purchases a share of a property, usually with a mortgage, and pays rent on the remaining share, which is owned by a housing association or other provider.
Shared ownership is designed to help people who cannot afford to buy a home outright to get onto the property ladder, with a smaller deposit and mortgage.
Buyers can typically purchase an initial share of between 10% and 75% of the home’s value, depending on the scheme and location. They pay a mortgage on their share and rent to the housing association on the rest, plus any service charges.
For example, a buyer might buy a 40% share of a flat valued at 300,000, needing a mortgage and deposit for 120,000, and pay rent on the remaining 60%.
Buyers can usually buy additional shares over time, known as staircasing, until they own the home outright. Shared ownership homes are usually leasehold, and owners are often responsible for all repairs and maintenance even though they own only part of the property. Critics point to high service charges, rising rents and difficulties selling. Similar part-buy, part-rent schemes exist in some other countries, such as Australia.
For worked examples and full lessons, visit notesbysara.org.