For many first-time buyers, saving for a full deposit and securing a large mortgage can feel out of reach. Shared Ownership* offers a compelling alternative which allows you to purchase a portion of a property and pay rent on the remainder. It also gives you the option to increase your ownership of the home over time.
Shared Ownership can be a great way of getting onto the property ladder. It’s important, however, to understand how the system works as you decide whether it’s the right option for you.
Shared ownership is a part-buy, part-rent model; you purchase a share of a property (usually around 50% of the market value) and pay rent on the remaining share. This means that if a home is valued at £200,000 and you buy a 50% share, you’ll pay £100,000 via mortgage or savings, and rent on the remaining £100,000.
With Shared Ownership, you only need a deposit based on the share you’re buying and take out a mortgage for your share – making repayments more manageable than buying outright.
You pay a subsidised rent on the portion you don’t own. This is usually lower than market rent, and through a system called staircasing, you can increase your ownership share over time which proportionally reduces your rent.
The main benefits of choosing shared ownership are as follows:
Buyers can purchase from as little as a 50% share, meaning the deposit and mortgage are based only on that portion, not the full property value. With a 50% shared ownership on a £200,000 home, your 10% deposit would be £10,000, which is more achievable than full ownership – for the same home, it would be a £20,000 deposit and £180,000 mortgage.
Through staircasing, you can gradually increase your ownership share – potentially up to 100%, but this depends on the development.
Instead of paying rent with no return, shared ownership allows you to build equity while still paying a manageable monthly rent on the unowned portion.
There are some limitations that apply to Shared Ownership. When the time comes to take the next step on your property journey, you will only sell your share of the property. If the price has risen over time, your share of the increase will be proportionate to your ownership. Furthermore, the market to buy the property may be limited to people who qualify for the scheme.
If you're tired of renting and eager to take your first step onto the property ladder, Rowland Homes’ Shared Ownership scheme could be the opportunity you've been waiting for. Browse our developments for availability and contact the Sales Executive to find out more.
*The required percentage of the full asking price must be purchased and is subject to qualification criteria. A monthly rental payment is payable on the unpurchased percent. Available on selected plots. Criteria, terms & conditions apply. Please see our Sales Executive for full details.
