Shared ownership mortgages are designed to help people take their first step onto the property ladder by part-buying and part-renting their home. It’s a flexible solution for those who can’t afford to buy a home outright and is especially popular among first-time buyers, key workers, and those with limited deposits.
With a shared ownership mortgage, you purchase a share of a property (usually between 25% and 75%) and pay rent on the remaining share, typically owned by a housing association. Over time, you can increase your ownership through staircasing by buying more shares as your circumstances allow.
How Shared Ownership Works
You choose a property available under a shared ownership scheme, purchase your chosen share with a mortgage, and pay rent on the rest. Here’s how it typically works:
- You buy a share between 25% and 75% of the property’s value
- You take out a mortgage for shared ownership to cover your portion
- You pay subsidised rent on the remaining share to the housing association
- You may also pay a service charge or ground rent, depending on the property
This model reduces the deposit required and makes affordable homeownership more accessible.
Who Is Eligible for Shared Ownership?
You may be eligible if you meet the following criteria:
- You are a first-time buyer or do not currently own a home
- Your total household income is £80,000 or less (or £90,000 in London)
- You are unable to afford a suitable home on the open market
- You pass an affordability assessment and meet lender criteria
To check your affordability and options, use our Mortgage Calculator or speak with one of our advisers.
Benefits of Shared Ownership Mortgages
Shared ownership offers several benefits:
- Lower deposit requirements based on the share you buy
- Access to newer homes, often in desirable locations
- Option to increase your ownership over time through staircasing
- Ideal for first-time buyers, key workers, and single-income households
It’s a practical solution for those who need a more affordable entry point to homeownership without waiting years to save a larger deposit.
Things to Consider Before Applying
Like any mortgage, shared ownership comes with responsibilities. Here are a few points to consider:
- You are responsible for 100% of property maintenance, even if you own only part of it
- You may need permission from the housing association before making changes to the property
- Selling the property usually requires you to offer it back to the housing association first
- Some lenders have specific criteria for shared ownership schemes
It’s important to get advice tailored to your situation. Our experts can guide you through the application and lender requirements.
Can You Buy More Shares Later?
Yes. Staircasing allows you to gradually buy more shares in your home when financially ready. In most cases, you can eventually own 100% of the property, eliminating rent payments. Each staircasing step will require a valuation and legal process, but it gives you flexibility to increase ownership over time.
Find the Right Shared Ownership Mortgage
Not all lenders offer shared ownership mortgages, and rates or criteria can vary. Our team has access to a wide panel of specialist lenders and can match you with the right deal for your situation.
→ “Find Mortgage Advisers” who understand shared ownership and can help you apply with confidence.
If you’re a broker supporting clients with affordable housing, you can “Join our Mortgage network” and access exclusive tools, training, and shared ownership lenders.
Thank you for reading our “Shared Ownership Mortgages | Get on the Property Ladder” publication. Stay “Connect“-ed for more updates soon!
