Shared Ownership...
what’s it all about?
Shared Ownership is a way to buy your own home if you can’t afford to buy a house outright. It’s a great way to get onto the housing ladder and costs are usually lower than other home ownership options.
Based on what you can afford, you buy a share in a home and pay a reduced rent on the share that you don’t own. A housing association (in this instance Halton Housing) owns the share that you rent.
Buying a percentage of your home means a lower deposit and smaller mortgage is needed. Shares range from 25% to 75% initially, with the option for you to buy more once you’ve moved in, usually up to 100%.
What am I buying?
When you buy a Shared Ownership home you are a homeowner and will take on all the responsibilities of owning our own home, but you gain all the benefit too! Buying with shared ownership means that you’re purchasing a leasehold home with a lease in place – a legal document between you and Halton Housing. Our leases vary in length, but the most recent are 990 years, which means that you needn’t worry about any leases extensions.
Who can buy a Shared Ownership home?
Shared Ownership is a great option for a range of buyers who are looking to get their foot onto the property ladder but can’t afford to buy a home outright. You may have experienced a relationship breakdown, are looking to start a family, or wanting to downsize.
You’re able to buy a Shared Ownership home if:
-
You are at least 18 years old
-
Your annual household income is less than £80,000
-
You are unable to afford a home suitable for your housing needs on the open market
-
Either you’re a first-time buyer, you don’t own your own home, or you already own a shared ownership home and would like to move to another.
-
Your income is sufficient to cover the mortgage (if applicable), rent and service charges.
-
Your chosen Shared Ownership home is affordable and sustainable for you.
Staircasing
You can buy a share of a Shared Ownership home starting from as little as 25%. Shares are only available from 25% – 75% initially, but once you have moved in, if your financial position changes, you have the option to buy more shares in your home. This is what’s known as staircasing. Usually, you can staircase up to own 100% of your home; in this instance you no longer pay any rent, just your mortgage along with any service charges and ground rent.
The greater the share you own, the more you will benefit from increased house prices (but it’s worth remembering that prices can go down too). However, staircasing is completely optional. Some may choose to buy additional shares as their financial position changes but many stay at the share that they currently own.
​
If you would like to staircase, you can do it in affordable stages, but we’d suggest you wait until you can afford to buy at least an additional 5% – 10%, to make it worthwhile. Shares are calculated on your home’s current market value; therefore, your home must be valued for you to buy more shares.
If you’d like to buy more shares in your home, please get in touch with a member of our team and we’ll be more than happy to go through the options with you.
What are the costs?
It’s important to be aware of the costs involved with the purchase of a shared ownership home, both the initial costs and ongoing monthly costs once you’ve moved in. The initial costs are:
Reservation fee
The reservation fee is a non-refundable £500 fee you pay to reserve your home. The cost is deducted when you complete on the purchase of your home.
Deposit
When you buy a shared ownership home, you’ll usually need to pay a mortgage deposit, this is the amount paid towards the share you’re buying initially. The amount varies from lender to lender, but typically it’s 5-10% of the value of share you’re buying. For example, if you’re buying a 50% share of a home worth £150,000, your share will be £75,000. And based on 5%, the deposit needed will be £3,750.
Solicitors fees
You’ll need to appoint a solicitor to act on your behalf. They will handle the ‘conveyancing’ for you (transferring the title of the home legally to you), To help the process go as smoothly as possible, make sure that the solicitor you choose has experience with Shared Ownership. If you need any help with suggested solicitors, please speak to your sales negotiator.
Moving, decorating, and furnishing costs
There are likely to be costs involved with moving your belongings to your new shared ownership home, make sure you shop around to get the best possible price. All our new shared ownership homes come with flooring to the bathrooms and kitchen, but you’ll need to organise installation and cover the cost for other areas. Then there’s the fun part – the decorating and furnishing of your new home!
​
Ongoing costs
Once you’ve moved into your shared ownership home, you’ll have monthly mortgage repayments to make, along with rent, service charge costs. Please speak to your sales negotiator for further details on these.
Until you own the freehold, Halton Housing will provide buildings insurance but the homeowner is responsible for their own contents insurance. You’ll need to factor in costs for utilities (gas, water and electric) and Council tax too.
Whether or not you qualify for a Shared Ownership home is often referred to as ‘eligibility’ and is dependent on a number of factors...
Buying a new home is a life-changing experience. The buying process and requirements for Shared Ownership are a little different to when you buy a home outright. Find out how to make your shared ownership buying journey as smooth and stress free as possible, with our step-by-step guide...
As part of the government’s Affordable Homes Programme 2021 – 2026, some changes to Shared Ownership were introduced; in a challenging market, it’s hoped that the changes will help more people get a foot onto the property ladder.