What is shared ownership?
Shared ownership (sometimes known as 'part rent, part buy') is an affordable housing product that enables households to take their first step towards home ownership, that they could not otherwise do on the open market, by buying an initial share of a property and through purchasing new shares (known as 'staircasing') work their way to 100% ownership.
Shared ownership properties can be new builds, existing properties, houses and flats, and are always 'leasehold', making shared owners 'leaseholders'. This is because a share in the property is bought and not the 'freehold', which is owned by the 'freeholder'. The precise terms and conditions of shared ownership schemes can vary depending on the housing provider.
Because households will only own part of the property, they can buy it with a smaller deposit and mortgage. A smaller mortgage means smaller repayments, thereby making it a more affordable route to home ownership for some households. However leaseholders will also need to pay:
- Rent on the share of the property they do not own (referred to as the 'unsold equity')
- Monthly service charges
- Ground rent (only in certain circumstances, where this is not in breach of the Leasehold Reform (Ground Rent) Act 2022)
To be eligible for shared ownership, households need to:
- be 18 years or older
- have an annual household income of less than £80,000 (£90,000 in London)
- be first-time buyer, or an exisiting shared ownership homeowner, or a former homeowner who can't afford to buy on the open market due to certain circumstances
New shared ownership model
In 2021 the Government launched a new national model for shared ownership which is intended to be "fairer, more affordable, and more consumer-friendly". The new model applies to all new grant-funded shared ownership homes delivered through the £11.5 billion Affordable Homes Programme (AHP) 2021-2026. The AHP is expected to deliver up to 90,000 new shared ownership homes across the country.
Key features of the new model include:
- The minimum initial purchase share in a property is reduced from 25% to 10%
- New shared owners can buy additional shares in their homes in 1% increments for up to 15 years with reduced fees, though it will still be possible to staircase in larger increments with minimum additional share purchase reduced from 10% to 5%
- The cost of repairs and maintenance is met by the landlord for the first 10 years after purchase of a new property (with some limits)
- The minimum shared ownership lease term is extended from 99 years to 990 years
More information on the shared ownership scheme can be found by visiting the Own your Home website.
You can also keep up to date with shared ownership across the district by signing-up to our free Keep Me Posted bulletin service by selecting the 'Affordable Housing' options as the topic.
Dover District Council is a Data Controller under (UK) GDPR. We process your personal data in compliance with data protection legislation. The personal data you provide will be used to process and assess your application, your data will be kept for the minimal period necessary to meet our purpose. For further information on your Rights and how the Council processes your personal data, please view our Shared Ownership and Corporate Privacy Notice.
Last updated: 25 May 2023