Benefits of Shared Ownership

September 2019
Shared Ownership is a great scheme that can help those on lower incomes, those with smaller deposits, or those seeking a new home after retirement or a relationship breakdown find and buy their perfect home for less. However, it seems to still be a little misundersood and underrated - so we're going to take a look at a few of the benefits of Shared Ownership!

Benefit one: lower deposits and mortgages

On the open market, or through the Help to Buy scheme, you'll need to secure a deposit and a mortgage. These will be based on the purchase price of the property, and while with Help to Buy, it's possible to purchase a home with a 5% deposit, you'll likely need a much bigger deposit if you're planning to buy on the open market. 

With Shared Ownership, your deposit and mortgage will be a percentage of the share price, rather than the full purchase price. Like Help to Buy, a deposit of 5% is acceptable. So if you were interested in buying a 25% share of a property worth £100,000, the share price being £25,000, your deposit would only need to be a minimum of £1,250 and your mortgage a maximum of £23,750. 

Benefit two: a mortgage is not mandatory

If you have enough savings to cover the share price of your property, then you will have the option to buy it outright! This is great for people who are selling an existing property, as the money you receive from the sale of your house can go towards your new Shared Ownership property - with no more worrying about a mortgage!

Benefit three: you get all the perks of ownership for less

Some might think that buying a Shared Ownership property means that you are restricted in terms of decorating and won't be able to make the home your own. This isn't true, however. You are free to paint, hang pictures and make your place unique and comfortable. Another thing that isn't true is the myth that Shared Ownership means you share with other buyers. The 'share' part simply refers to the fact that you're purchasing a share of the property from the Housing Association. You won't have to move in with any strangers!

Benefit four: you can increase your share

While you don't have to increase your share, you can choose to increase the percentage that you own if you wish. The process is called 'staircasing' as you will gradually increase your ownership in increments, as if climbing a flight of stairs! Under 75s can eventually own 100% of the property. Those aged 75 or over can increase their share to 75% - but won't have to pay rent on the remaining 25%. 

Shared Ownership is a fantastic, affordable way for first time buyers and current home owners to purchase the property of their dreams. For more information of how the scheme can benefit you, please visit our Shared Ownership page