Shared Ownership

Shared ownership allows people who are unable to afford to purchase on the open market to buy a share in a property and pay rent on the remaining share which is owned by a  housing association.  This means a smaller mortgage and correspondingly smaller deposit is needed to buy the share than would be required to buy a property outright. 

Shared ownership properties are either purpose built new build properties, re-sales of the same, or re-sales of properties bought through other shared ownership schemes (such as Do It Yourself Shared Ownership).

How Shared ownership works

• Eligible applicants buy a minimum 25% share in the property, with a mortgage and/or deposit.  In the case of new build properties applicants are expected to buy the maximum share they can afford.  In the case of re-sales, applicants will buy the share advertised.
• Rent is paid to the housing association who owns the remaining share.
• Further shares can be bought at a later date (this is called staircasing).
• The combined mortgage and rent payments will be less than the cost of a full mortgage.
• On completion the applicant is considered an owner occupier in terms of maintenance and management of the property, however major works to the property will require written consent from the housing association.

Eligibility

The applicant must:

• be registered with Home Point,
• be unable to afford to purchase a home on the open market,
• have a household income of less than £60,000,
• be able to fund the purchase of the share with a mortgage and/or deposit, and afford the rent payments over and above.

Buying a shared ownership property

• Properties are advertised by Home Point and by the HomeBuy agent in the first instance, and then by local estate agents.
• Applicants will deal directly with the agent advertising the property.
• When bidding for a property the applicant will undergo a financial assessment to ensure affordability.
• Applicants are permitted to purchase property size needed plus one additional bedroom.

Sale of a shared ownership property

• The housing association who owns the other share must be notified of the intention to sell.  They may nominate a known suitable buyer or will advertise the property through Home Point and the HomeBuy agent.  If they are unsuccessful in finding a buyer for the share, the property can then be advertised by the seller on the open market through an estate agent.
• The new owners will continue to pay rent to the housing association.

For further information contact Housing Solutions on 01432 261600, or visit Orbit HomeBuy agents.