How does Shared Ownership work?
Shared Ownership helps make buying a home more affordable for eligible buyers who cannot afford to buy outright.
You can usually buy an initial share of 25% to 75% of the value of a home, and you’ll need to take out a mortgage to pay for your share of the home’s purchase price, unless you can buy your share outright.
You will then pay a subsidised rent on the share you don’t own, and there will also be a service charge to make up the monthly cost of buying through Shared Ownership.
By buying through Shared Ownership, you will need a smaller deposit than buying on the open market. It will also make you a leaseholder and owner-occupier in your home, giving you many of the same responsibilities as a homeowner.
Watch our 60 second guide to Shared Ownership
Benefits of Shared Ownership
Buying a share of a home means a smaller deposit is required compared to buying a new home outright.
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Affordability
It’s a more affordable way to purchase a home without needing a large deposit.
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Quality
You can own a high quality, new build home affordably without compromising on location or quality.
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Flexibility
You can buy as much of the property as you can afford, 'Staircasing' to buy more shares in the future, eventually owning 100% of your home.
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Start your homeowner journey
It’s a great way to get out of the renting cycle and become a home-owner.
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Make it your own
You will own the home and be able to decorate it however you like.
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Share in the profits
You can sell your home at any time and will benefit from any increase in value.
Who is eligible for Shared Ownership?
✔ You must be aged 18 or older.
✔ Your annual household income if buying in London must be £90,000 or less (£80,000 or less outside of London).
✔ You will usually be a first-time buyer, an existing shared owner looking to move, or someone who used to own a home but can no longer afford to buy one that meets your needs. If you currently own a property, you must have sold it before completing your Shared Ownership purchase.
✔ You should not be able to afford to buy a home on the open market.
✔ You must be able to show you are not in rent or mortgage arrears and demonstrate a good credit history.
*Eligibility may vary depending on property size and whether there are any criteria imposed by the local authority.
Buying a Shared Ownership home
To buy through Shared Ownership with us, you first select a property and determine the share you can afford, typically between 25% and 75% of the home's value.
Next, you will need to arrange a Shared Ownership mortgage for your chosen share, often with the help of a mortgage adviser who can guide you through the process and assess your Shared Ownership Affordability.
Once your application and purchase are approved, you'll become a leaseholder of the property usually with a 250 to 999-year lease agreement, depending on the property.
This long-term lease provides you with the right to occupy the home for an extended period, offering significant security. For the remaining share that you don't own, you'll pay rent to the housing association or landlord, usually set at a below-market rate (2.75% of the share you don’t own with Peabody).
Shared Ownership Staircasing
As a Shared Owner, you will usually buy a percentage of the home (from 25%). Over time as your savings grow, you will be able to 'Staircase' which means to buy more shares and own a greater proportion of your home.
The greater the share you buy of your home, the less rent you pay to Peabody. If you Staircase to 100% you become an outright owner and pay no rent!
It is important to consider the costs beforehand and whether Staircasing is right for you. Remember, Staircasing is completely optional and can be done at any time, subject to your lease and eligibility.
Explore Shared Ownership homes for sale in London and the Home Counties
For many London buyers getting onto the property ladder is a real challenge. Shared Ownership offers a more accessible way to buy, allowing you to purchase a share of a home and pay rent on the remaining share.
With Peabody New Homes, you can find Shared Ownership homes across London, from modern apartments to family-sized homes. Our homes are a great choice for first-time buyers, and Shared Ownership could help you take the next step.
Ready to start your search? Explore our latest Shared Ownership homes in London and the Home Counties, including new build homes and resale properties available.
Shared Ownership FAQs
You can sell your home at any time. Under the terms of your lease, Peabody will have eight weeks to find a buyer for your home so your property can remain a Shared Ownership property.
You can then decide to instruct an estate agent on the open market or continue to advertise it with us.
Our dedicated resale team offers advice and support throughout the process and you will be provided with a reselling pack once you submit an intention to sell form.
Yes. You can gradually purchase more shares of your home through a process called ‘Staircasing’. Staircasing is optional, so it’s up to you whether you want to buy more shares.
As you buy more shares in the property, you pay less rent. This is because the rent you pay is based on the share that Peabody New Homes retains.
Each time you staircase we carry out a property valuation. You buy shares at the current market value, rather than the price you bought the first share.
Shared Ownership requires a significantly lower deposit which makes it especially appealing to first-time buyers.
Since you only purchase a portion of the property, typically 25-75%, the deposit is based on this smaller share, making it much more manageable than saving for a full property purchase. This lower entry barrier allows individuals to step onto the property ladder sooner.
The scheme also provides access to new build homes, which are often more energy-efficient and located in desirable areas, by buying a share rather than the full market value upfront.
Although Shared Ownership is a stepping-stone towards owning your own property, you are still a tenant and therefore need to ensure rent payments are made on time or your home could be at risk.
Most Shared Owners are also not allowed to sub-let their properties unless they seek permission from their landlords or own 100% of the property. In addition, you may not qualify for first-time buyer stamp duty exemption.
Yes. It is possible to make a joint application for Shared Ownership. This option is available to couples, friends, or family members who wish to purchase a property together through the Shared Ownership scheme. Joint applicants must meet the eligibility criteria collectively, which typically include income requirements, first-time buyer status (or specific exceptions), and other factors set by the local authority.
When making a joint application, both applicants' incomes and savings are considered in determining affordability and eligibility. This can be advantageous as it may increase the overall budget and improve the chances of qualifying for a larger share or a more desirable property.
In some cases. Generally Shared Ownership homes are offered on a first come first serve basis unless there are any overarching local authority restrictions.
Local residency is often a key factor when it comes to local authority restrictions, with priority given to those already living or working in the borough where the Shared Ownership home is situated. This policy helps maintain community cohesion and support those with established local connections.
Yes. Peabody understands how important it is for buyers to find the right home for their family including their favourite furry friends. We have a pet policy that allows for certain pets to live in a Shared Ownership home. Households have our permission to keep two dogs, two cats, and a reasonable number of small mammals and/or caged animals.
When buying a Shared Ownership home, you'll need to arrange a mortgage with the help of a mortgage adviser who will help you with the purchase process.
A mortgage adviser is able to look at the mortgage market and if needed, arrange a Shared Ownership mortgage for you. They will help you fill in the mortgage application form, submit the application and handle the processing of the application on your behalf – saving you valuable time and ensuring the right type of mortgage is obtained.
If you want to arrange your own mortgage, you should talk to banks and building societies and make sure that you advise them that you are buying a Shared Ownership property and the share you are buying.
Homeowner Stories
Discover a collection of homeowner stories from previous Peabody New Homes purchasers and find out how we were able to help them onto the property ladder and find their dream home through Shared Ownership.
"It feels amazing to be paying my own mortgage instead of someone else’s. I also plan to staircase in the future to increase my ownership share. Never in my wildest dreams did I imagine owning such an incredible property in such a perfect location - but here I am."
"Shared Ownership isn’t something that exists in Italy. I was able to buy a 50% share and find somewhere to call my own."
"Staircasing allows you to buy as much as you can, when you can. You can evolve your homeownership as your circumstances change."
"Without Shared Ownership this move wouldn’t have been possible, this is an affordable way of getting onto the property ladder whilst being in such a great location."
What to read next...
Read some more useful guides and articles on buying with Shared Ownership.