Shared Ownership – the costs

When thinking about buying a Shared Ownership home, it is important to be aware of the costs involved in the purchase of the property and the monthly costs you will expected to pay once you have moved into your new home.

Buying a Shared Ownership home


When buying a Shared Ownership home you will need to put down a deposit. This is the amount you pay toward the cost of your share you are buying at the time of purchase. The amount required for a deposit will vary from property to property, but the typical Shared Ownership deposit is 5% or 10% of the share you are purchasing.

For example, if you buying a 25% share of a property with a full value of £300,000, the value of your share will be £75,000. If a 5% deposit was required, you would need to put down a deposit of £3,750.

Solicitor Fees

Your will need a solicitor or licensed conveyance professional to carry out the necessary legal work.  You will need to have instructed a solicitor before your mortgage application can be submitted and it is important to check with your solicitor that they are approved to work for your mortgage lender.  Solicitor’s fees are usually be on a fixed cost basis and all the solicitors on our mortgage panel will be happy to give you a quote.

Stamp Duty

Stamp Duty Land Tax (SDLT) is normally payable when property or land is purchased and is generally a percentage of the purchase price.  When purchasing a share in a Shared Ownership property you are not required to pay SDLT unless your share is eighty percent or more.  The solicitor or conveyancer dealing with your purchase is responsible for dealing with the SDLT and will be happy to advise you accordingly.

Mortgage Broker Fees

Most mortgage brokers will charge a fee for their services and these can vary from a fixed amount to a percentage of the purchase price.  A mortgage broker should explain clearly what fees are charged and when, before they undertake any work on your behalf.

The fees for the Share to Buy mortgage service are fixed and as follows:

  • To assess and carry out the necessary affordability calculations on an agreement in principle application – No Charge
  • To check documentation and submit an agreement in principle application to a lender for a credit scored agreement in principle – £50
  • To check full documentation and submit a full application to a lender and then liaise with the lender through to a mortgage offer being issued – £199

Other moving costs

Other costs may be incurred, such as removal costs but these can vary widely.   Housing Associations recommend that you have between £3,000 and £5,000 in hand to cover all the fees and costs of moving, which includes the solicitors and broker fees.


Monthly costs of a Shared Ownership home


Each month you will make repayments on your mortgage, until the tie the mortgage has been repaid. The amount you will pay towards your mortgage will be dependent on the value of the share you purchase, the deposit you put down, how long of your mortgage term is remaining and the interest rate.


The exact figures for the rent are sent to you with the viewing details. It is usually set around 3% of the unsold equity.

For example: if you wanted to buy a 50% share in a property worth £200,000 the equity you would pay rent on is £100,000. If you divide the unsold equity by 100 and multiply by 3 you will get the total rent payable per annum. Just divide this by 12 to get the monthly rent payable.

The amount of rent will vary for each home depending on:

  • The share you buy
  • The value of your property when you buy it

Service Charge

Service charges are payments by the homeowner to the housing association for the services they provide. These include maintenance and repairs to common parts, insurance of the building and, in some cases, provision of lifts, lighting, communal aerials, door entry systems, cleaning of common areas and grounds maintenance, etc. Usually the charges will also include the costs of management.

Service charges can vary from year to year; they can go up or down without any limit other than that they are reasonable. Details of what can and can’t be charged by the landlord and the proportion of the charge to be paid by the individual homeowner will all be set out in your lease.


Buildings insurance is be the responsibility of the Freeholder – quite often the housing association.  The cost will often be included in the service charge.  Contents insurance, which covers all your furniture, carpets, white goods and personal belongings, is the responsibility of the person living in the property – it is not compulsory to purchase but it is advisable.