Shared Ownership (Part Buy Part Rent)
What is Shared Ownership?
Shared ownership is an affordable home ownership scheme which involves part owning, part renting a property. It is designed for people who can’t afford to buy a home outright on the open market. It is available through housing associations and new build and existing shared ownership properties, known as resales, are available through shared ownership. It is the most established affordable home ownership scheme, and is available throughout England.
The most established affordable housing scheme is shared ownership, whereby you part buy part rent property from a housing association. The scheme is sometimes referred to as ‘part own part rent’ because you literally own part of the property and pay a rent on the remainder that is subsidised so as to be affordable.
How does Shared Ownership work?
· Buy a share in a property, usually ranging from 25% to 75%
· Pay below-market rent on the remaining share owned by a housing association
Although your maximum share can sometimes be capped, with most shared ownership homes you can 'staircase' to full ownership in the future (i.e. buy more shares in the property up to 100% ownership). There is more information about staircasing here.
The rent you pay can be up to 3% of the association's share of the property value. Shared ownership properties are leasehold properties, meaning you will own the lease on them for a fixed period of time, typically 99 years.
You also have to pay a service charge for the property, which is usually charged on a monthly basis.
What properties are available for part rent part buy schemes?
You cannot purchase any property on the open market. Shared ownership housing is generally restricted to properties owned by a housing associations.
Most part buy part rent properties are new build and the only national scheme for part owned houses on the second hand market is where an existing owner sells their share on to a new owner in a process known as a resale.
You can search for housing association shared ownership properties, including part buy part rent flats and houses, using our shared ownership property search tool.
Selling your shared ownership home
You can sell your shared ownership property at any time but the housing association has the right to find a buyer for your home, if it still owns a share of it and to buy it back first.
Shared Ownership mortgages
The mortgage team at Share to Buy ltd has significant experience in arranging mortgages for shared ownership schemes, and has access to the main part buy part rent mortgage lenders. Find out what you can borrow and the potential cost of a shared ownership mortgage using our shared ownership mortgage calculator tool which enables you to search for shared ownership mortgages from across the market.
Rent to buy
Rent to buy properties make another important affordable housing option. With the rent to buy scheme you can rent a property at a below-market rate, enabling you to save towards a deposit so that you can eventually purchase that property. Thus, rent to buy schemes offer a way to part own houses and flats after a period of initially renting them – hence, rent to buy housing is sometimes called ‘try before you buy’. You can find both rent to buy flats and rent to buy houses on the Share to Buy property website.
5th October 2015
Shared Ownership Week is the largest event of its kind and will provide information to first time buyers on how shared ownership can help them purchase a brand new home that they could not afford to buy outright. The aim of the campaign is to give confidence to first time buyers, clear up any questions they might have and reassure them that it is possible to take that first step onto the property ladder.
24th September 2015
Our latest guest blog comes from Aldwyck - London's Help to Buy agents and sponsors of the London Home Show Autumn 2015
"We are the Government appointed Help to Buy agent for Equity Loans in London, and can help to guide you through the process"
23rd September 2015
Our latest Guest Blog comes from Steve Hicks, Managing Director of Genie. Genie are exhibiting at our London Home Show on the 26th September.
"Here at Genie we believe now is the time for innovation and work is underway to deliver 2,000 new Genie homes in the capital over the next ten years. The homes will be available without the need for a mortgage or deposit and delivered with the assistance of a 10 year repayable loan from the Greater London Authority who have recognised Genie’s potential to revolutionise the housing market."
22nd September 2015
Our latest guest blog come from Lucy Chitty, Assistant Director of Sales at leading housing provider L&Q.
Lucy takes you through the 7 steps to go through once you've found a property you interested up to completing and being handed the keys to your first home.