Shared ownership

How does 'shared ownership' work?

In shared ownership you buy a share of the property – between 25 per cent and 75 per cent. This is calculated on the full open market value.

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The housing association owns the remaining share and you pay rent on that share. The annual rent paid is a maximum of 2.75% [s3] of the share’s value.

Shared ownership properties are always leasehold homes. This means you own them for a fixed period of time, usually 99 years.

When you buy your home, you become the owner of the lease. The housing association will grant you a lease for the fixed period, which also sets out your rights and responsibilities, and those of the landlord.

One of the requirements of the lease is to give the housing association first refusal to buy it back if you want to sell.

Example of shared ownership

Property purchase priceYour shareCost of your shareHousing Association shareCost of HA share
£100,000 50 %  £50,000 50 % £50,000

 
The table below shows how much this could cost you per month in mortgage payments and rent.

Possible costs per month in mortgage payments and rent

Example of shared ownership costsMonthly cost
Mortgage payments at 6 per cent interest over 25 years £322
Rent at 2.75 per cent of £50,000 (£1,375 over 12 months) £155
Total monthly payment £436

 

The Council works in partnership with a number of housing associations to build affordable housing to buy, including providing grant funding to invest in new homes each year. Shared ownership homes are advertised through Help to Buy South West.