A step-by-step guide to buying with Shared ownership

Buying a home is one of the biggest financial decisions most people will make. For many, saving for a full deposit can be daunting, which is why the shared ownership scheme can be an attractive solution.

Shared ownership allows you to buy a share of a property and pay rent on the remainder, lowering the upfront cost of homeownership.

This article offers a clear step-by-step guide to help you navigate the process in England.

Step 1: Understand What Shared Ownership Means

Shared ownership is a part-buy, part-rent government-backed scheme that helps buyers get onto the property ladder.

• You purchase a share (typically 10% to 75%) of the property.
• You pay rent on the remaining share to the housing association.
• You can increase your ownership over time through staircasing until you own 100%.

It’s important to note that you’ll still be responsible for 100% of the repairs and maintenance costs, regardless of the percentage you own.

Step 2: Check Your Eligibility

Before searching for properties, confirm that you meet the eligibility requirements:

• Your household income must be below £80,000 per year (£90,000 in London).
• You must be a first-time buyer, a previous homeowner who can’t afford to buy now or an existing shared owner.
• You must have a good credit history and be able to afford mortgage, rent and service charges.

Some developments prioritise local residents, key workers or people with specific needs, so check individual scheme criteria.



 


Step 3: Set Your Budget

Working out what you can realistically afford is crucial. Consider:

• Deposit: Typically 5% to 10% of the share you are buying.
• Mortgage: You’ll need to qualify for a mortgage on your share only.
• Monthly Costs: Include mortgage repayment, rent on the remaining share, service charges and ground rent.

Don’t forget one-off costs like solicitor’s fees, mortgage arrangement fees, valuation fees and moving expenses.

Tip: Use a shared ownership calculator or speak to a mortgage broker familiar with the scheme to get an accurate picture of affordability.

Step 4: Search for Properties

Once you know your budget, start browsing shared ownership homes:

• Search on newhomesforsale.co.uk to see a wide range of shared ownership developments across England.
• Register with local housing associations or shared ownership agents.
• Compare service charges carefully, as these can vary between developments and impact monthly affordability.
• Consider location, transport links, schools and amenities just as you would with a standard home purchase.

Step 5: Get a Mortgage in Principle

A mortgage in principle shows how much a lender is likely to lend you and demonstrates to housing associations that you’re a serious buyer. Many lenders offer shared ownership mortgages, but using a specialist mortgage broker can help you find the most suitable deal.

Step 6: Apply for the Property

When you find a home you like, submit your application through the housing association. They will:

• Check your eligibility.
• Carry out a financial assessment.
• Confirm you can afford the purchase.

If accepted, you may pay a reservation fee (usually around £500) to secure the property.

Step 7: Appoint a Solicitor

Choose a solicitor or conveyancer experienced in shared ownership purchases. They will:

• Review the lease agreement and explain your rights and obligations.
• Carry out property searches.
• Liaise with the housing association and your mortgage lender.

This step is crucial to ensure you fully understand what you are buying.

Step 8: Finalise Your Mortgage and Legal Work

Your mortgage lender will conduct a valuation, issue a formal offer and your solicitor will progress the legal paperwork. This includes signing contracts and agreeing on a completion date.



 


Step 9: Exchange Contracts and Complete

When all legal work is done, you’ll exchange contracts. At this stage, the purchase becomes legally binding. On completion day, your mortgage funds are released and you get the keys to your new home.

Step 10: Plan for the Future

Once you’re settled, think about your long-term goals:

• Budget for ongoing maintenance and service charges.
• Consider staircasing if you want to increase your ownership share.
• Keep track of your lease term. Extending it early can save money later.

Final Thoughts

Buying a home with shared ownership can be a practical way to get onto the property ladder, especially if you’re struggling to save a large deposit. By following these steps, you can approach the process with confidence and make informed decisions about your future home.

For the latest shared ownership properties across England, browse listings on newhomesforsale.co.uk and start your journey toward homeownership today.