At a glance
- Not all Shared Ownership homes use the new model, so always check the Key Information Document for the home you are interested in. Guinness Homes will clearly state if a development is available through the new Shared Ownership model.
- You can buy an initial share from 10% under the new Shared Ownership model (based on affordability).
- New model leases are at least 990 years from new, instead of 99 years.
- Buy more shares in steps of 5% or more, and leases also allow 1% staircasing each year for the first 15 years. It also allows staircasing to at least 80%.
- There is no landlord administration fee for 1% staircasing.
- Homes include a 10-year initial repair period, which can help with certain repair and maintenance costs while you own less than 100% of the home.
- You may be able to claim up to £500 a year for qualifying repairs, and any unused amount can usually be carried forward once into the following year.
- Shared Ownership is usually for households earning up to £80,000, or up to £90,000 in London, subject to affordability checks.
How the initial share differs
With Shared Ownership, you buy a share of a home and pay rent on the part you do not own. The new model works in the same basic way, but some of the rules are different.
Under the new model, the minimum share you can buy at the start is 10%, rather than 25%. This can mean a lower deposit and a smaller mortgage when you first buy.
How buying more shares differs
If you want to own more of your home in the future, you can buy extra shares through a process called staircasing. As your share goes up, the rent you pay on the remaining share goes down.
Under the new model, you can usually buy extra shares of 5% or more.
New model leases also allow you to buy an extra 1% each year for the first 15 years after you become a shared owner.
For 1% staircasing, the landlord does not charge an administration fee. The price is usually based on the original value of your home, adjusted in line with the House Price Index, unless a RICS valuation is used instead.
If you buy a larger extra share, usually 5% or more, the price is based on the current market value of your home at that time. A RICS valuation is usually needed, and there may be an administration fee.
How repair costs differ
One of the main features of the new Shared Ownership model is the initial repair period. This usually lasts for 10 years and applies while you own less than 100% of your home.
During this period, you may be able to claim up to £500 a year towards certain repair and maintenance costs. If you do not use the full amount, any unused sum can usually be carried forward once into the following year.
This support is generally for qualifying repairs to things such as water, gas or electricity supplies, heating systems, and some parts of the structure. Repairs that are already covered by a warranty, guarantee or insurance policy are not usually included.
If the home is sold through Shared Ownership during the 10-year period, any remaining repair support passes to the new shared owner.
Who can apply
Shared Ownership is aimed at people who cannot afford to buy a suitable home on the open market.
In most cases, your household income must be £80,000 or less, or £90,000 or less in London.
You will also need to pass the affordability checks for the scheme. In most cases, buyers should not already own another home when they complete their purchase.
Right to Shared Ownership
Some tenants may also have the Right to Shared Ownership.
This applies to most new Social Rent and Affordable Rent homes delivered through the Affordable Homes Programme 2021 to 2026, although there are some exceptions.
If eligible, tenants can buy an initial share of between 10% and 75% of their rented home, then buy more shares later under the new Shared Ownership rules.
To qualify, tenants usually need to be 18 or over, have lived in their current home for at least 12 months, and have spent at least 3 years as a tenant in social or affordable housing. They must also meet the usual income and eligibility rules.