Does Shared Ownership mean that I have to share my home with someone?
Not at all! The 'shared' element of Shared Ownership is because you are sharing the ownership of the home with a housing association like Peabody.
You will buy a percentage of the home (usually 25% initially) and pay rent on the percentage you don't own to the housing association. You can however 'staircase' and buy more shares until eventually you own 100%! This means you will own the home outright.
You don't have to live in your Shared Ownership home with anyone else, although you can still buy jointly with someone else, say a partner or friend, if you choose to.
Is Shared Ownership only available to first-time buyers?
Shared Ownership is an affordable housing scheme designed to help people buy a home that they otherwise wouldn't have been able to afford on the open market.
Traditionally it is used by first-time buyers looking to step onto the property ladder who have previously either been living at home or renting privately.
However, Shared Ownership isn't only available to first-time buyers. As long as you meet the basic eligibility criteria for Shared Ownership (i.e. have a household income under £90,000) then you can buy. You just need to ensure that you do not own another home or you’re in the process of selling your current property.
Therefore Shared Ownership is a great option for you, even if you aren't a first-time buyer.
Is it more expensive to buy through Shared Ownership?
More often than not, Shared Ownership usually works out as being less than renting when it comes to monthly outgoings.
With Shared Ownership, you will pay a mortgage on the percentage of the home that you own, and then a subsidised rent on the percentage you don't own. Along with a service charge, this makes up your total monthly outgoings which is often less than renting privately and not much more than buying a home outright, but with a much smaller deposit!
You can 'staircase' and buy more shares in your home too which will increase your mortgage costs but reduce the rent you pay until you eventually own 100%.
Is it difficult to get a Shared Ownership mortgage?
In short, No. Whilst not all lenders provide mortgages for Shared Ownership, the majority will, including the largest mortgage lenders in the market. Shared Ownership has become one of the main affordable ways to buy a home and has helped thousands of UK buyers step onto the property ladder, so most lenders are able to offer a mortgage on a Shared Ownership property.
Being able to get a Shared Ownership mortgage ultimately depends on your affordability, which looks at how much savings you have as well as your annual income, and outgoings.
When you are looking to buy a Shared Ownership home, you will be asked to complete an affordability assessment with an Independent Mortgage Advisor to work out what you can realistically afford to buy. The Independent Mortgage Advisor will also be able to help show you what mortgages are currently available to you and work out the best rates available.
Is it difficult to sell a Shared Ownership home?
Shared Ownership was designed as a more affordable way to get onto the property ladder and was meant as a stepping stone to full home ownership. This could be in the form of staircasing up to 100% or by selling your home and buying on the open market.
When it comes to selling a Shared Ownership home, it's not that different to selling privately. Usually, you would sell through the housing association you bought through but more often than not you also have the option to sell via an estate agent if you choose to.
The housing association would still list your property on various property portals and you would conduct property viewings with potential buyers. The only difference is you will need to sell your home to someone who meets the Shared Ownership eligibility criteria and they must buy at least the share you currently own.
Can I decorate a Shared Ownership home?
When buying a Shared Ownership home, you will become a owner occupier which effectively gives you the same rights as a home-owner. This means that unlike renting privately, you are completely free to decorate your Shared Ownership home as you wish.
That means if you like a contemporary finish, an art deco style or more brutalist design, you can decorate however you please which is a major attraction to Shared Ownership.
More often than not, the Shared Ownership home will be a new-build home, which will be a blank canvas to really stamp your mark on the place!
There are some limitations when it comes to major adaptations and structural changes like knocking down walls, which will require the approval from the housing association you have purchased from.
Is Staircasing complicated and expensive?
It’s a common shared ownership myth that Staircasing is overly complicated or costly. Whilst Staircasing involves legal and financial steps, it is designed to be a clear process that takes 3 or 4 months to complete. With Peabody, we provide a Staircasing Enquiry Pack and access to mortgage advisors to make the process as straightforward as possible.
You have flexibility in how much you Staircase at a time. The benefits such as reduced rent and more equity, and eventually full ownership, make it a worthwhile process for many Shared Owners.
Guide to StaircasingMore Shared Ownership myths
Shared Ownership properties generally follow the same market trends as other properties. If property values increase in your area, so should the value of your share in your home.
Shared Ownership is available to anyone who meets the eligibility criteria, the only age restriction being a minimum age of 18 years old.
Staircasing allows you to purchase increasing shares of your home, with the goal of owning 100%. Once you purchase 100% of shares then you will be the outright owner of the home. You will have to still pay service charges and may have to pay ground rent.
No. In addition to our brand new properties, Peabody New Homes often have older ‘Resale’ properties available for sale.
These are Shared Ownership homes that the current owner bought as a new-build or from an existing shared owner and now wish to sell on.
At the moment, if you are a first-time buyer, you do not have to pay Stamp Duty if your home costs less than £300,000.
If you do have to pay, you’ll have the option of paying Stamp Duty on the full value of the property or just on the share that you are purchasing.
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."
"It’s a 10/10 apartment, the quality here is exceptional!"
"It's great to be living in a buzzing new area that is both affordable and has plenty to offer!"