For many first-time buyers in the UK, the rising cost of property makes homeownership seem out of reach. The Shared Ownership Scheme provides a way to get onto the property ladder by allowing buyers to purchase a share of a home and pay rent on the remaining portion. Here’s how to navigate the shared ownership process.

1. What is shared ownership?

With shared ownership, you buy between 25% and 75% of a property and pay rent on the remainder. Over time, you can increase your share through a process called “staircasing,” eventually owning the property outright. This makes it easier to afford a home, with smaller deposits and mortgage requirements.

2. Eligibility criteria:

The scheme is aimed at first-time buyers, those with an income under £80,000 (£90,000 in London), and people currently renting social housing. You’ll need to meet certain financial criteria, including having a good credit history, and be unable to afford a home on the open market.

3. Choosing the right property:

Most shared ownership properties are new builds or managed by housing associations. These homes are often located in areas with limited availability, so it’s important to act quickly. Ensure the property is in a location where you can see yourself living long-term.

4. Financial considerations:

You’ll need a mortgage for the share you purchase, along with a deposit. Rent on the remaining share is typically lower than private rental prices but is still an additional cost. Other costs, such as service charges and maintenance fees, should be factored into your budget before committing.

5. The long-term plan:

Shared ownership can be a stepping stone to full homeownership. As you pay down your mortgage, you can gradually increase your share in the property. Some schemes may have restrictions on selling or transferring the property, so it’s important to read the terms carefully.