If you want to buy a home with a small deposit you might be asking what is Shared Ownership? And with the Help to Buy Equity Loan scheme ending next year, it might prove even more popular than ever with buyers.

What is Shared Ownership?

Put simply, with Shared Ownership you buy a share of a property and pay rent on the remaining share. You’ll usually buy a share of between 25%-75% of the property but you can buy a 10% share of some homes.

What are the benefits of Shared Ownership?

One of the main benefits of Shared Ownership is that it can make home ownership more affordable and achievable. That’s because as you’re only buying a percentage of the property you’ll require a smaller mortgage and that means you’ll need a smaller deposit too. So you might be able to get on the property ladder much sooner than you’d thought!

So who can apply for Shared Ownership houses?

Shared Ownership is available for first-time buyers but it’s open to other people too like if you used to own a home but can’t afford one now.

But there are other boxes you’ll need to tick like your household income must be £80,000 or less, or £90,000 or less in London.

How do Shared Ownership mortgages work?

First things first, you’ll only need a mortgage for the share you’re going to buy.

For example, if you want to buy a 25% share of a £200,000 property under Shared Ownership with a 5% deposit:

  • Your share of the property would be £50,000
  • Your deposit would be £2,500
  • Your landlord’s share would be £150,000
  • You would need a mortgage of £47,500.

To get started it’s a good idea to speak to a mortgage adviser. That’s because they’ll be able to talk you through the process and find the right mortgage for you too.

Are there any other Shared Ownership costs?

If you're asking what is Shared Ownership you'll probably want to know if you'll need to pay any other Shared Ownership costs. When you find your perfect home you’ll usually need to pay a reservation fee of up to £500 to the landlord. This will be taken off the final amount you pay. There are also other costs you’ll need to factor in like any legal fees and stamp duty on your share if that applies. And once you move in you might need to pay things like a service charge.

What is Shared Ownership: Can I increase my share?

So what if you want to buy more of your home once you've moved in? With Shared Ownership houses and flats you can usually increase your share of the property; this is called ‘staircasing’. And if you buy more shares, you’ll pay less rent. In most cases you can keep buying shares until you own the property outright but in some instances there are restrictions on how much of a share you can buy. So make sure you check this.

What homes can I buy through Shared Ownership?

You buy Shared Ownership homes from housing associations, local councils and other organisations. You can buy new-build homes or resales from current Shared Ownership home owners.

Shared Ownership Vs Help to Buy Equity Loan scheme – how do they compare?

So how does Shared Ownership compare with the Help to Buy Equity Loan scheme? Well with Shared Ownership you buy a percentage of the property and pay rent on the rest. Whereas with the Help to Buy Equity Loan scheme you’ll buy the whole property. To do this you’ll need a 5% deposit (5% of the total value of the house) and the Government lends you up to 20% of the property’s value – or up to 40% if the property is in London. And you’ll take out a mortgage for the remaining amount. However, this scheme ends next March and it’s also only open to first time buyers.


  • This information on Shared Ownership applies to England. There are different rules in Scotland, Wales and  Northern Ireland.
  • The information on Help to Buy Equity Loan scheme only applies to England.


Important information

Your home may be repossessed if you do not keep up repayments on your mortgage.

There may be a fee for mortgage advice. The actual amount you pay will depend on your circumstances. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.