What is shared ownership?
With shared ownership, you buy an initial share of a home (25% – 75% of the current open market value) using a mortgage or savings. You then pay a reduced rent on the share you do not own.
You may increase your share in the future through a process known as ‘staircasing’. Your rent is adjusted to reflect this. In some cases you may be able to buy outright after as little as 1 year of occupation, although there are some restrictions on rural schemes.
When you buy a shared ownership property, your deposit will be lower than on the open market. This is because you only need to raise a deposit for the share you are buying, and not the full open market value.
Am I eligible?
To be eligible to apply for a shared ownership home, you will need to register with the local Help to Buy Agent.
You also need to meet the following criteria:
- Annual household income less than £80,000
- Unable to purchase a home suitable for your needs without assistance
- Not a current home owner (or named on the deeds of another property) in the UK or abroad
- No outstanding credit issues (ie unsatisfied defaults or County Court Judgements).