This page covers the England scheme. Scotland, Wales and Northern Ireland have different models and rules. Read the key information document and lease with a conveyancer before reserving or exchanging.
How Shared Ownership works in England
GOV.UK states that buyers purchase between 10% and 75% of the home's full market value, although the initial share for a particular property can be restricted. You fund the share with a mortgage, savings or both, and pay rent on the landlord's share. All Shared Ownership homes are leasehold.
The deposit is usually calculated as a percentage of the share being purchased, not the full value. That lowers the initial cash deposit but does not remove the rent, service charge, estate charge, management fee or repair obligations set out in the lease and key information document.
Who can apply?
For the England scheme, household income must be no more than £80,000 a year, or £90,000 in London, and the household must be unable to afford the deposit and mortgage payments for a suitable home. Applicants must also meet an eligible-buyer condition, such as being a first-time buyer, a former owner who cannot now afford to buy, forming a new household, moving as an existing shared owner, or owning a home that will be sold because a suitable replacement is unaffordable.
A provider can apply property-specific priorities or local-connection requirements. Passing scheme eligibility does not guarantee mortgage affordability or allocation of a home.
The complete monthly cost
Mortgage payment
Capital and interest, or another structure if permitted, on the share purchased.
Rent
Paid to the landlord on its share and reviewed as the lease specifies. GOV.UK says new-build rent is capped at 3% initially and most landlords charge 2.75%.
Service or estate charge
For communal services, estate areas and management. Amounts can change and are separate from rent.
Repairs reserve
Some leases require sinking-fund payments for major works that may not be returned on sale.
Insurance and repairs
Check buildings insurance arrangements and who pays for internal, structural and communal repairs.
Tax and transaction costs
Legal fees, valuation, mortgage costs and SDLT choices depend on the transaction and circumstances.
What a Shared Ownership lender assesses
The mortgage lender assesses income, commitments, credit, deposit and the property. It also includes rent and relevant charges in affordability. The lease, provider, remaining term, staircasing rules, resale restrictions and valuation can affect whether the property is acceptable security.
Ask a broker which Shared Ownership lenders and products it can access. A mortgage in principle obtained before a specific property is chosen does not confirm that the lease or service charge will be accepted.
Staircasing
Staircasing means buying more of the home. The price is based on a current valuation and the lease defines the process, permitted increments, fees and any maximum ownership. Buying more reduces rent because the landlord owns less, but can require valuation, legal, mortgage and administration costs. Some properties restrict staircasing below 100%.
Checks before reservation
- 1. Read the key information document. Record every current charge and what can increase.
- 2. Model future costs. Stress the mortgage rate, rent review and service-charge changes together.
- 3. Check the lease term. A short remaining lease can affect future value, sale and remortgage options.
- 4. Understand repairs. Establish liability for defects, major works and any initial repair allowance.
- 5. Review resale rules. Check nomination periods, valuation, marketing, fees and whether the share or whole home is sold.
- 6. Obtain a case-specific tax calculation. Shared Ownership SDLT can be handled in different ways.
Request a Shared Ownership broker match
An introduced broker should confirm its lender scope, experience and fees before advice.
Request a broker match