Whatever has brought you to this point, finding the right home can be an important step towards feeling settled again.
Having a home of your own can mean privacy, stability, and the freedom to create a space around the life you have now. Shared Ownership may help make that next step possible if buying outright is beyond your current budget, allowing eligible buyers to purchase a share of a home and pay rent on the part they do not own.
Why buying a home again can feel difficult
Buying a home after a big life change can feel like starting from scratch even if you've gone through the process before.
Your finances might have drastically changed. For example if you've gone from two incomes down to one, or now have children. At the same time, you may need to make decisions quickly while dealing with everything else that comes with a change in circumstances.
There may also be extra practical steps to work through, such as selling a previous home or budgeting what you can comfortably afford each month.
If you currently own a property, its sale must be completed on or before the day you complete your Shared Ownership purchase.
Saving for a house deposit on one income
If you're only working with a single income, then saving for a deposit can be a real challenge, especially if you're currently renting in a competitive area like London.
You may also be rebuilding your savings after paying moving costs, having a change in employment or the expense of setting up a new household. This doesn't mean homeownership is out of reach, but it may mean finding a route that asks less upfront.
With Shared Ownership, the deposit is based on the share you buy rather than the full value of the property. Deposits are 10% of that share, which can significantly reduce the amount you need to save compared with buying a home outright on the open market.
You will still need to budget for your mortgage, rent on the remaining share, service charges and other costs, however they can often be lower than renting in the same area.
How to balance affordability with location
After a life change, where you live can matter just as much as the home itself. Staying close to work or being near family, friends, and childcare can be a top priority to make costs manageable.
But the areas that keep those connections within reach are not always the easiest places to buy on the open market.
Shared Ownership can help you stay local to an area you're connected to, by letting you buy a share that fits your budget rather than funding the full property price from the start.
If you're eligible for Shared Ownership, this can mean living in a central London location without giving up on home ownership.
How Shared Ownership can make homeownership more achievable
Starting again does not have to mean putting your plans for homeownership on hold. Shared Ownership gives eligible buyers another way to purchase a home when the cost of buying outright is beyond their current budget.
With Peabody you can buy a share of a home, starting at 25%.
For example, a 25% share of a £400,000 home would cost £100,000. If a lender required a 10% deposit, the amount needed would be £10,000 rather than 10% of the full £400,000 value.
A smaller share generally means a smaller mortgage, but you will pay rent on a larger portion of the home. Working through the figures with a mortgage advisor can help you understand which option offers the right balance for your circumstances.
Can you buy more of your home later?
The share you buy at the beginning does not have to be the share you own forever.
If your income rises or your finances become more settled, you will be able to purchase additional shares through a process called Staircasing.
As your ownership increases, the rent charged on the remaining share reduces. It may be possible to Staircase to full ownership, although this depends on the terms of your lease and any restrictions attached to the home. Additional shares are priced using the property’s market value at the time.
Is Shared Ownership right for your next chapter?
If your circumstances have changed, the kind of home you need may have changed too. Shared Ownership is definitely worth considering if you are ready to buy but cannot afford a suitable home outright.
To become a Shared Ownership homeowner, you will need to meet the eligibility criteria and show that the mortgage and other costs are manageable for you.
At Peabody we offer a choice of new-build and pre-owned Shared Ownership homes across London and the Home Counties. These include well-connected apartments in central London to more spacious houses in the home counties with more room for family life.
With more than 160 years of housing experience, Peabody can guide you through the buying process and help you understand the costs before you commit.
Explore Peabody’s available Shared Ownership homes today and register your interest in a development that suits your budget.
Frequently asked questions about buying through Shared Ownership
Yes. Forming a new household after a relationship breakdown or divorce is one of the circumstances covered by the Shared Ownership eligibility rules.
Bear in mind if you own a home with a former partner, its sale must complete on or before you complete your Shared Ownership purchase.
Yes. You can apply on one income, so long as you meet the eligibility requirements and can afford the monthly costs.
An affordability assessment will consider your income, spending, debts and financial commitments to work out what size share of the home you can manage.
It can be. Shared Ownership may offer a more affordable way to buy if divorce has changed your income, savings or housing needs and you cannot afford a suitable home outright.
The amount depends on the home and the share that you buy initially. Deposits are calculated against the value of your share rather than the full property price and are often 10% of that share. For example, a 10% deposit on a £100,000 share would be £10,000. Remember to budget for legal, mortgage, and moving costs too.
It could. Because you buy a share of the home rather than the full property, Shared Ownership may make it possible to consider London locations that would otherwise be outside your budget.
You will still need to meet the eligibility and affordability requirements, and the homes available will vary by area.
Yes. Buying more shares is known as Staircasing, and it can reduce the rent you pay on the remaining share.
The amount you can buy and whether you can staircase to full ownership will depend on your lease.
