Shared Ownership Mortgages Guides & Advice

Shared ownership allows an eligible buyer to purchase a percentage of a property and pay rent to a housing association or provider on the remaining share. A mortgage is usually required for the purchased share, together with a deposit. You also pay service charges and other property costs. Shared ownership is leasehold and the lease terms, eligibility and resale restrictions should be understood before proceeding.

The deposit is usually calculated as a percentage of the share being purchased rather than the full market value, although lender and scheme requirements vary. You must also budget for legal fees, valuation, mortgage costs and any applicable tax. Rent and service charges are included in affordability, so a smaller mortgage deposit does not automatically mean the overall monthly cost is affordable.

Eligibility is set by the relevant scheme and housing provider and may include household income limits, housing need and restrictions on existing property ownership. Local priorities can also apply. Meeting scheme eligibility does not guarantee a mortgage; the lender separately assesses affordability, credit history, deposit and the lease. Obtain approval from both the provider and lender.

Lenders assess the mortgage payment alongside rent on the unsold share, service charges, ground rent where applicable, debts and normal household expenditure. They also review the lease, property and housing provider. Because rent and service charges may increase, affordability should not be judged solely on the initial mortgage payment. The housing provider may carry out its own affordability assessment too.

Staircasing means buying additional shares in the property, potentially up to full ownership where the lease permits. The price is normally based on the property's market value at the time, and valuation, legal and mortgage costs may apply. Buying more shares can reduce rent on the unsold portion but increases ownership and possibly mortgage borrowing. Restrictions apply to some properties.

Yes, but the lease usually gives the housing provider a period to nominate a buyer or market the share before it can be sold more widely. A valuation is normally required, and the buyer must meet eligibility rules unless the property has been staircased to full ownership and restrictions no longer apply. Legal fees, valuation costs and any mortgage repayment charge should be considered.

Remortgaging may be possible, either on the existing share or alongside staircasing. The new lender must accept the scheme, housing provider, lease and remaining term. Consent from the housing provider may be required, and legal work can be more involved than a standard remortgage. Product choice is narrower than for conventional ownership, so start the review early.

Review the lease length, rent review formula, service charges, repair responsibilities, staircasing rules, resale process and any restrictions on alterations or subletting. Confirm the full monthly cost and how it might change. A solicitor experienced in shared ownership should explain the lease, while mortgage advice should confirm that both the property and your circumstances fit lender criteria.