Can You Get Shared Ownership on Any Property?

Can you get shared ownership on any property? This question is becoming increasingly relevant in the modern housing market, where traditional homeownership is often out of reach for many potential buyers. Shared ownership schemes offer a way to purchase a portion of a property while paying rent on the remaining share. However, not every property is eligible for this arrangement. To determine whether a property can be purchased under shared ownership, it's crucial to understand the specific requirements and limitations that govern these schemes. This article delves into the various factors that influence shared ownership eligibility, explores the different types of properties that can be included, and provides practical advice for potential buyers looking to navigate this complex landscape.

Understanding Shared Ownership

Shared ownership is a housing scheme designed to help individuals and families who are unable to afford a home on the open market. The concept allows buyers to purchase a share of a property, usually between 25% and 75%, while paying rent on the remaining portion. This arrangement makes homeownership more accessible by reducing the amount of money needed for a deposit and mortgage.

Eligibility Criteria: Not all properties qualify for shared ownership. The eligibility criteria for shared ownership schemes are often defined by local housing authorities or housing associations and can vary depending on location. Typically, the following factors influence whether a property can be included in a shared ownership scheme:

1. Property Type and Condition: Shared ownership is commonly applied to new build properties or those that have been specifically designated for this scheme. Properties in poor condition or those requiring significant repairs are less likely to be eligible.

2. Location: Properties located in certain areas may be more likely to qualify for shared ownership, especially in regions where there is a higher demand for affordable housing. Urban areas and regions with high property prices are often prioritized for shared ownership schemes.

3. Price Limitations: There are often price caps on properties eligible for shared ownership. These caps are set to ensure that the properties remain affordable for those who are purchasing a share. The price limits can vary depending on the region and the local housing market conditions.

4. Ownership Restrictions: Some properties may have restrictions on ownership that affect their eligibility for shared ownership. For instance, leasehold properties or those with specific covenants might not be available for shared ownership.

Types of Properties Suitable for Shared Ownership

New Build Homes: Many shared ownership schemes focus on new build properties. These homes are often built specifically for the scheme and are designed to meet modern standards. New build homes can offer a range of benefits, including energy efficiency and modern amenities.

Resale Properties: In some cases, resale properties may be eligible for shared ownership. These are typically homes that were previously purchased under the scheme and are now available for resale. Resale properties can provide an opportunity for buyers to enter the market in areas where new builds are limited.

Older Properties: While less common, some older properties may qualify for shared ownership. These homes must meet certain standards and be in good condition to be included in the scheme. The condition of the property and any required repairs can influence its eligibility.

The Application Process

Finding Eligible Properties: Prospective buyers can start by searching for properties that are advertised under shared ownership schemes. Housing associations and local authorities often have listings of available properties. Online platforms and property portals may also feature shared ownership homes.

Application Steps: The application process typically involves the following steps:

1. Assess Eligibility: Ensure that you meet the eligibility criteria for the shared ownership scheme. This may include income limits, local residency requirements, and other factors.

2. Submit an Application: Apply for shared ownership through the relevant housing association or local authority. This may involve providing financial information and details about your housing needs.

3. Secure Financing: Obtain a mortgage for the share of the property you wish to purchase. Lenders who specialize in shared ownership can provide guidance on financing options.

4. Complete the Purchase: Once your application is approved and financing is in place, you can complete the purchase of your share of the property. You will also need to sign a lease agreement for the portion you do not own.

Financial Considerations

Deposit and Mortgage: One of the main advantages of shared ownership is the reduced deposit requirement. Because you are only purchasing a share of the property, the deposit and mortgage required are lower than if you were buying the entire property.

Rent Payments: For the portion of the property you do not own, you will pay rent. This rent is typically set at a percentage of the property's market value and is subject to periodic review.

Additional Costs: In addition to the deposit and mortgage, shared ownership buyers should budget for other costs, including legal fees, survey costs, and ongoing maintenance expenses.

Conclusion

Shared ownership offers a valuable opportunity for those struggling to afford full homeownership, but it's important to understand the limitations and requirements that come with this scheme. Not every property is eligible for shared ownership, and the specific criteria can vary widely. By researching and understanding these factors, potential buyers can make informed decisions and find a property that meets their needs.

With the right approach and careful planning, shared ownership can be a viable pathway to homeownership, providing both financial relief and the satisfaction of owning a home.