Scheme rules and restrictions
Can I sell a shared ownership home?
Yes, you can sell your shared ownership home at any time to:
- buy another shared ownership home
- buy another home outright
- move elsewhere.
If you decide to sell your share, then your landlord will have a period of time (set out in your lease) in which to sell your home to another shared owner.
This is to ensure that shared ownership homes funded by government continue to remain as affordable housing and available to other shared ownership applicants.
If your landlord is not able to sell your property to another shared owner, then you will be free to sell it on the open market.
If your home has increased in market value, then you will benefit from this increase in line with the amount of equity in the home you own. However, if the market value of your home has decreased then you may receive less money than you have paid in.
If you have made improvements to your home, then you will benefit from the full value of these improvements that you have paid for.
Your landlord’s sales team will advise you of the full process and how this all works when you get to the point of wishing to sell and move.
Can I buy more shares in my shared ownership home?
Once you have taken your first step on to the housing ladder by buying an initial share you can, at any point afterwards, buy more shares in your home. This is known as ‘staircasing’.
There will be some homes that have restrictions on staircasing which your landlord will have advised you about before you first bought the home. Any restrictions will also be detailed in your shared ownership lease. For most homes, however, there will be no restrictions and you will be free to staircase to own 100% of your home outright.
Additional shares can be bought in a minimum of 10% amounts. These can be purchased using cash or by increasing the amount you borrow from your mortgage lender. Your lender will check that you are able to afford to do this.
If you later sell your home, and its value has increased, you will benefit from the additional value of your home. If the value of your home has decreased, you may get back less than you have put in.
If you wish purchase additional shares you will need to get in touch with your shared ownership landlord to discuss this. Your lease will set out the process you will need to follow.
You will need to get your home valued by an independent surveyor. This valuation will set the price you will need to pay for the additional share. You will also have to instruct a solicitor to act for you in the purchase of the additional shares.
It will be down to you to pay the valuation fee, solicitor's fees, any mortgage fees plus any administration fees that your landlord may charge.
What are shared ownership resale homes?
Shared ownership resale homes are properties that have previously been bought through the Help to Buy: Shared Ownership scheme by an owner who now wishes to sell. The shared ownership landlord, as set down in the lease, has a period of time in which they can market and sell the home to another shared ownership applicant in order to keep the home as affordable housing.
If the home is not sold within this period, then it can be sold on the open market either as a shared ownership home, or outright through a process called ‘back-to-back staircasing’ (the shared ownership landlord will explain the options to you).
The Help to Buy agent property website will make clear whether a home is a resale shared ownership home or not.
What is the difference between a freeholder and a leaseholder?
A freeholder owns the land that the property is built. A leaseholder buys the right to live in a property for an agreed period of time (set out in the lease) but does not own the land the property is built on.
Shared ownership homes are always sold on a leasehold basis.
Managing your finances
What other costs are there to buying a shared ownership home?
As with any home purchase there are a number of additional costs involved that you will need to budget for. These include:
- the costs of a valuation of your home
- legal costs for the buying process (known as conveyancing)
- any mortgage fees.
There may also be other costs on top of this about which the shared ownership provider will advise you. You will also need to budget for the other normal costs involved in moving home such as removal costs.
As a shared owner you will be responsible for the maintenance and repairs to your home. Your landlord is responsible for any communal areas and other certain building repairs and maintenance. This will be explained to you during the application process and will be set out in your lease. You are allowed to make improvements to your home with the permission of your landlord, and you can benefit from any increases in market value that these bring to your home.
What are service charges?
It is likely that certain service charges will be payable on leasehold properties, particularly flats and apartments. These service charges will cover costs such as the maintenance and upkeep of communal areas, communal gardens and services such as cleaning the external windows in a block of flats. These charges will also include major work such as repairs to the roof of a block of flats.
The amount of service charge will vary from property to property. The shared ownership landlord will be able to provide details of these if you are interested in one of their shared ownership homes.
Will there be any financial advice available to help me?
If you are thinking of buying a shared ownership home then we would recommend that you consult an independent financial advisor (IFA) although this is not a requirement. They will look in detail at your income and expenditure and advise you on what you can afford. A charge may be made for such advice by a financial advisor.
They are not employed by either the Help to Buy agent or shared ownership landlord so their advice is impartial. To help you, the shared ownership landlord may provide you with a list of financial advisors, but you are not required to use one of these and can find an alternative via the links on the help and advice page. Any list provided will include financial advisors that are familiar with the whole process of shared ownership, as well as the shared ownership provider.
Please note that any advice provided by a financial advisor, about how much you can afford, does not mean that is the amount that you will end up buying. If you require a mortgage your lender will do their own assessment which may be different in terms of what they think you can afford and, more importantly, how much they are willing to lend you by way of a mortgage.
Will I need any legal advice?
Buying a shared ownership home is no different to buying a home outright. It is advisable to appoint a solicitor to act on your behalf, who can deal with the conveyancing process (the legal transfer of the title to you). They are also needed to help you understand the terms of your lease, and deal with the shared ownership landlord’s legal team. You will need to budget for these legal fees if you purchase a shared ownership home.
We would recommend that you employ the services of a solicitor who is familiar with the shared ownership product as the work involved is different to someone buying a home outright. To help you the shared ownership landlord may have a list of solicitors who they have worked with and consider reputable, and who they know understand what is required for a shared ownership purchase. It is, however, not a requirement that you use one of these solicitors - you can find a solicitor via the links on the help and advice page.