Thankfully, there’s a more achievable way in: Shared Ownership. This government-backed scheme is helping thousands of people step into their own homes, often with much smaller deposits and more manageable monthly costs than buying outright.
In this guide, we’ll explain how Shared Ownership works, why it’s a practical option for a two-bedroom apartment, and what you need to do to get started.
Understanding the London property market
London’s property market is highly competitive and costs vary widely by area, so having a clear picture of the landscape is essential.
Average costs of a two-bed apartment in London
London's property market continues to be one of the most expensive in the world. On average:
A two-bed apartment in London can range from £400,000 to well over £700,000, depending on the area. The average price of a two-bed house sold in November 2025 was £737,690 according to GetAgent.
In high-demand neighbourhoods, prices can exceed £900,000+.
Even emerging regeneration areas sit around £350,000–£500,000, which still pushes many buyers beyond affordability.
This makes saving for a full deposit, typically 10% or more, a significant hurdle for most.
Why is buying in London getting harder?
Several factors contribute to the difficulty of buying a two-bed flat in London:
- High demand and limited supply, especially in well-connected areas.
- Rising rental costs, making it tougher to save a large deposit.
- Competitive bidding, which can push prices even higher.
- Stricter mortgage affordability rules, limiting borrowing potential.
This is where Shared Ownership London homes offer a more affordable, achievable path.
How to afford a two-bed apartment through Shared Ownership
One of the biggest advantages of Shared Ownership is that it dramatically lowers the upfront costs of buying a home in London.
Instead of paying for a full property, you only purchase a percentage share, most of the time between 25% and 75%, and pay subsidised rent on the remainder (2.75% with Peabody).
Here’s how this can work in practice using real examples from Dagenham Green:
- 1-bedroom apartment: Buy a 30% share of a £270,000 home for £81,000. With a 10% deposit, you’d only need £8,100 upfront, with monthly payments starting from around £1,007.
- 2-bedroom apartment: Buy a 30% share of a £340,000 home for £102,000. A 10% deposit of £10,200 plus monthly costs starting from £1,291 makes this a realistic option for first-time buyers.
- 3-bedroom apartment: Buy a 30% share of a £455,000 home for £136,500, with a 10% deposit of £13,650 and monthly payments from £1,702.
For reference, the average price of a home in Barking and Dagenham on the open market was £356,630 in September 2025.
These figures show that you can move into a spacious two-bed flat in London without saving a huge deposit or taking on a full mortgage. Over time, you can increase your ownership share through Staircasing, eventually owning 100% of the property.
Benefits of Shared Ownership
- Lower deposit requirements compared with buying outright
- Reduced monthly costs versus renting a comparable property
- Opportunity to staircase and increase your ownership over time
- Access to modern, energy-efficient homes in growing London neighbourhoods
- Ideal for first-time buyers London looking for an affordable route onto the property ladder
With Shared Ownership, a two-bed apartment in London doesn’t have to remain out of reach, Peabody’s new build homes across London make homeownership achievable and affordable.
How London Living Rent can help you save for a two-bed apartment
Another way to save towards getting a two-bed home in London is with London Living Rent. This is also a government-backed scheme, designed to make renting in the capital more affordable while helping you save for home ownership.
For many first-time buyers, it can be a vital stepping stone. Two-bedroom London Living Rent homes will be available from the new year 2026 at North Gate Park.
Two-bedroom London Living Rent homes cost around £1,077 per month on average, which is typically below market rent.
This allows tenants to reduce their monthly outgoings and set aside savings specifically for a deposit to buy a home, rather than spending it all on rent.
London Living Rent gives you the opportunity to rent in areas you might otherwise be priced out of.
You can live in well-connected, desirable locations, build a savings habit, and prepare for the move into a two-bed apartment through Shared Ownership or outright purchase.
Many London Living Rent tenants are offered the chance to purchase their rented home on Shared Ownership terms.
This means the money you save on rent each month can directly contribute to a deposit for a share of the property.
For example, a two-bedroom Shared Ownership home at Dagenham Green has a 30% share price of £102,000, with a deposit of £10,200. Rent savings can make achieving this deposit much more manageable.
LLR provides an assured tenancy of 3 - 10 years, giving tenants time to save while enjoying the flexibility of renting. Dedicated support from Peabody can help ensure you stay on track to reach your home-buying goals.
Buy a two-bed home in London with Peabody
Peabody offers a range of new developments across the city, each with its own unique appeal.
Lombard Square in Plumstead offers a perfect blend of tranquillity and city access, ideal for first-time buyers and young professionals. Two-bedroom Shared Ownership homes start from around £450,000, with a minimum deposit from just £11,250.
In Lewisham, The Crescent Collection at Arden offers stylish two-bedroom homes from £445,000. Residents can enjoy concierge services, landscaped gardens, and a co-working hub, making it great for modern city living.
For West London, KEWB in Brentford combines riverside charm with urban convenience. Two-bedroom homes are available through Shared Ownership from roughly £560,000, providing a more affordable way to step onto the property ladder.
Frequently asked questions about buying a two-bedroom home in London
Yes. Through Staircasing, you can increase your ownership share over time eventually up to 100% in most cases.
No. You can also apply if you’ve owned a home before but can’t afford to buy now, or if you’re an existing shared owner looking to move.
With Shared Ownership, deposits are usually start from 5 - 10% of your share. This can be as low as £8,000 - £15,000, depending on the property and share size.
