Shared Ownership Scheme: Helping You Become a Homeowner
The shared ownership scheme is a government-supported initiative that helps individuals or households who cannot afford to buy a property outright. It is designed to provide an opportunity for people to become homeowners by purchasing a share of a property and paying rent on the remaining portion.
Different Rules for Shared Ownership in Northern Ireland, Scotland, and Wales
The initial purchase amount of shares, the cap on the value of the property you can buy, the monthly rent payment, and stair-casing methods to increase your share in the property may differ between schemes.
Eligibility Criteria for the Shared Ownership Scheme
Prospective buyers must meet certain criteria to qualify for the scheme. Typically, you would be a first-time buyer, have a household income within a specified range, and not able to purchase a suitable home on the open market. However, if you already own another home or want to move but cannot afford a new home that meets your needs, you may still apply for the scheme.
✅You must meet the household income range.✅You cannot afford all of the deposit and mortgage payments on the open market.⭕️You are a first-time buyer.⭕️You own a home and have formally accepted an offer for its sale with written confirmation.⭕️You are an existing shared owner.
Pros of the scheme
✅Deposits required are lower than buying on the open market.✅Mortgages are more accessible, even for those with lower income.✅Monthly rents are generally lower compared to private renting.✅You can purchase more shares of your home in the future, up to 100%.✅You can pay part of the Stamp Duty on the initial purchase.
Cons of the scheme
❌You are required to pay 100% of the ground rent and service charge, regardless of how low your share is.❌If you have not already paid the full Stamp Duty at the beginning, you will need to pay it on the entire value of the property at the time when you owned 80% or more of the share.❌Shared Ownership properties are sold on a leasehold basis, which may restrict you from making home improvements.