What is Shared Ownership?

24 November 2021

Shared ownership is part of the Government’s Help to Buy programme and is aimed at helping people who are unable to afford to buy a home. 

If you want to buy a house that is for sale but cannot afford the total cost, you may be able to receive help through the shared ownership scheme.

Be aware, shared ownership is not the same as shared equity. Shared equity means you own the home outright, but with shared ownership a housing association still owns part of the home and charges you a fee to live in it.

How it Works

Through shared ownership, you will buy a share of a home instead of having to fund its entire cost. You can buy a 25%, 50% or 75% share of a home. The remaining share is owned by a housing association. For example, if you buy a 25% share, the housing association will own the remaining 75% share.

Occupancy Charge

As the housing association owns a share of your home, you don’t own it outright. To allow you to live in the home, you must pay an Occupancy Charge to the housing association.

The housing association will inform you of how much the Occupancy Charge is.

Responsibilities 

Even though you may not own your home outright through shared ownership, you are still responsible for any other costs a homeowner would be expected to pay, as you live there.

These include: 

• Paying the mortgage
• Factors costs
• Building insurance
• Council tax
• Heating, lighting and water bills
• Fittings and furniture
• Home contents insurance
• Repairs and maintenance

How to Apply

If you’re interested in shared ownership, you can find out more about it from the participating social landlord in your area. There may already be a waiting list of people who want shared ownership, and they’ll take your housing needs into account to see where you will sit on the list. 

If you are eligible, the housing association will give you an application form to complete. If you are successful, they will contact you when a home becomes available and what the next steps are.

How to Qualify

Priority for shared ownership housing will be given to:

• First time buyers with limited housing alternatives
• The armed forces
• Veterans who have left the armed forces within the past two years
• Public sector tenants
• Low income families
• Disabled people
• Widows and widowers 

Increasing your Share

When first entering your shared ownership agreement you will start by buying a 25%, 50% or 75% share in the home.

You will have the option to buy a larger share at any time after you’ve lived there a year. This is called ‘staircasing’. The housing association will tell you how much of a larger share you can buy.

If you choose to buy a larger share, the Occupancy Charge you pay will be recalculated to reflect the smaller share owned by the association.

Selling your Home

You may sell your home (or your share) at any time, but you will have to inform the housing association in writing that you wish to move.

If you sell your home, you will receive the same share of the selling price that you own. For example, if you own a 25% share in the home, you will get 25% of the selling price.