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How to Buy a Shared Ownership Property
A step-by-step guide to buying a shared ownership home
Step 1: research
If you are reading this page, you have probably heard a little bit about shared ownership and want to find out more. Sharetobuy.com provides an ideal starting point for researching shared ownership and affordable housing schemes. You can:
- Search for shared ownership properties. We use a special affordability tool for all our properties that shows the likely monthly cost and deposit required, so this is a great way to get a feel for what properties are available and how much they might cost. If you are unable to find any shared ownership homes on our website you can register for updates when we do have properties in your area.
- We also have a shared ownership mortgage calculator linked to live mortgage rates in the market to give you a fairly robust estimate of the amount you might be able to borrow and the potential cost.
- For further reading, we also have a whole section of our website for people getting started with shared ownership and affordable housing.
Step 2: register
The above tools at sharetobuy.com should give you a feel for the potential cost of shared ownership. However, even if this is attractive, you also have to be eligible for the various shared ownership schemes available where you want to live. Thus, the next step is to register with your 'homebuy agent'. Your homebuy agent is a housing association that the Government has designated as the initial point of contact in your region for shared ownership enquiries.
They should be able to confirm if you are eligible for any of the different homebuy schemes, but they also have details of shared ownership and homebuy properties for sale or rent in your area. For any shared ownership purchase, you will have to pass a general affordability assessment undertaken by the homebuy agent, in addition to any affordability checks conducted by the mortgage lender or the housing association selling the specific property. You can find details of your local homebuy agent by contacting the Department of Communities and Local Government.
Step 3: agreement in principle
By registering with our property site and the homebuy agent, and also by checking local newspapers and other media, hopefully in good time a shared ownership property will come on the market that you would like to purchase. Assuming that you qualify in terms of general eligibility and affordability, which you should be able to check with the housing association selling the property, you will then need to show that you can obtain a mortgage. You do this by obtaining a 'decision in principle' which is a non-binding commitment from a mortgage lender that they will lend you a specified sum for a mortgage loan. If you have started looking at properties in earnest, or have found one that you like, you can submit an agreement in principle application at sharetobuy.com, with no fee for doing so and no obligation to go on and apply in full should you be successful.
Step 4: apply
Once you have obtained a decision in principle in your favour, you will need to wait for the housing association to formally offer you a shared ownership property. This formal offer may require you to pay a reservation fee and is normally set out in a document called a 'memorandum of sale' which confirms the share for sale, rent payable etc. When the property has formally been offered to you, you should submit a full mortgage application at sharetobuy.com. If you have received a decision in principle from the Share to buy mortgage team, you can log back in to your online application and provide the full property details, solicitor etc. We will then help arrange your mortgage right up to completion and take care of any paperwork.
Step 5: instruct a solicitor
Once you have been formally offered a property and are ready to apply in full, you will need to appoint a solicitor, though ideally you would instruct them not to undertake any work for which non-refundable fees will be billed until the application is well underway (e.g. after you receive a positive valuation of the property). The solicitor is responsible for important aspects of the property purchase, known as 'conveyancing'. While you may appoint any firm of solicitors to represent you, we also have partner firms of shared ownership solicitors who have considerable experience in shared ownership and charge competitive rates.
Step 6: valuation and mortgage offer
Once your full application is submitted to the lender, they will commence checking all the paperwork and will instruct a valuation of the property that you intend to purchase. This is an important step because many shared ownership properties are brand new and lenders tend to be tougher in the way that they value new properties. If the property is down-valued, you will have to contact your housing association to see if they are prepared to negotiate. If the valuation passes, once all your paperwork is approved by the lender you will receive a formal mortgage 'Offer'. At this point you should give some consideration to arranging insurance to protect yourself and the property that you intend to purchase.
Step 7: completing the purchase
With a full mortgage Offer from a lender, it is then down to the solicitors to undertake the remaining legal stages of the purchase which should result - at some point - in you receiving the keys to your new shared ownership home.
Shared Ownership Case Studies
Latest News
Shared ownership properties for sale
16th May 2012
Are you looking for properties for sale through the shared ownership scheme? These are homes where you part buy part rent, meaning that your initial deposit and potentially your monthly payments are somewhat lower than in a normal house purchase. Look no further! We have shared ownership houses and flats available on the part buy scheme across England. Search our property portal or register for alerts.
Firstbuy shared equity houses in Greater Manchester
16th March 2012
This is your chance to buy a share in a brand new 2, 3 or even 4 bedroom house and yet own the whole thing from the outset. These lovely houses in Hyde, Manchester are available on the Firstbuy scheme, a Government sponsored shared equity affordable housing scheme that means you can put down a deposit starting from as little as £5,600. More detail here on the 2 bed house, 3 bed house and 4 bed house.
Tools
- Search: search for shared ownership properties; search for shared ownership mortgages; search for shared ownership solicitors.
- Calculators: shared ownership mortgage calculator; staircasing calculator; open market calculator.
- Apply: shared ownership mortgages; agreement in principle
If you are in the process of buying a shared ownership house or flat, there are plenty of resources to provide further assistance. You can search for shared ownership homes at sharetobuy.com. For those wanting to buy shared ownership homes in the future, you can research the issues by browsing our site or contacting your regional homebuy agent. Of course, there are important legal issues involved in buying shared ownership homes so you may wish to consult our solicitor panel. Finally, for the all important finance, please contact our shared ownership mortgage team.
Compare mortgages
Compare shared ownership mortgages for the part buy part rent scheme.
