Shared Ownership is the main low cost home ownership product available in England; in London delivered through FIRST STEPS and the rest of England delivered through HomeBuy.
With Shared Ownership, you buy a share in the value of a new home with a mortgage, from as little as 25% of the full market value of the home, and pay a rent, which is initially capped at a maximum of 3%, on the rest (which is the part owned by us). If you buy an apartment, you will pay a service charge to cover the cost of maintenance of communal areas and the grounds of your building plus a management fee. If you buy a house you will be charged a management fee.
You will need to have savings to cover any deposit required by your mortgage lender and the costs involved in moving.
Shared Ownership is designed so that you can buy a new home with a lower deposit and with monthly housing costs that are approximately 20% lower than if you were to buy the same home outright on the open market or rent it privately.
When you can afford to, you can take your next steps and increase the share you own, this is known as ‘staircasing’. The cost of the additional share that you buy will be based on the market value of your home at the time of buying more shares. You can staircase until you own your home outright. By buying an additional share through staircasing, you will reduce the amount of rent you pay. If you staircase to the point where you own outright, you will no longer have to pay rent to MHO.