What is Shared Ownership:

Eligibility criteria:

There are certain criteria you have to meet in order to qualify for a shared ownership property which are as follows:

• You have a household income of less than £80,000 per year
• You do not already own or have interest in another property, if you own an existing home this property will need to be Sold Subject to Contract before an application will be considered.
• Not be able to purchase a suitable property for your current needs on the open market.
• You will have sufficient savings to cover both deposit and associated purchasing costs.
• You will need to have an affordability assessment carried out by bdht’s approved financial partner.
• You will need to register with Home Choice Plus (this is a requirement) 

1. For New Build Shared Ownership homes please look under our Find a Home page where you will be able to find further information on our latest new build schemes such as house type, location and timescales. Should you be interested in one of these schemes please register your interest via the email to our trusted partner estate agents, Oulsnam. They will then reach out to you to discuss your interest and should you wish to proceed direct you to our financial partners, for an affordability assessment.

For a Re-sale Shared Ownership home, these will be available on the online property portals such as Rightmove, Zoopla etc. Should you be interested in one of these properties you will need to speak with selling estate agent in the first instance. They will then reach out to you to discuss your interest and should you wish to proceed direct you to our financial partners, for an affordability assessment.  

2.  The independent financial advisor will then complete a financial assessment. This will be required ahead of reservation / formal offer acceptance to ensure the property is suitable for you. This process will involve returning the Shared Ownership Affordability Assessment form, a credit check for each applicant and further supporting information such as: 

• 3 months payslips 
• 3 months bank statements
• Photo ID (Driving licence or passport)
• Evidence of your deposit as advised by the Financial Advisor (Bank statements, or if gifted, a letter from your donor stating that it is a non-repayable gift intended as a deposit for the property)
• Agreement in Principle. Must be for a mortgage product that it is for Shared Ownership
• Any other relevant documentation as requested by the Financial Advisor. 

3. Once you have satisfied the above and have been approved as eligible to purchase a Shared Ownership property you will need to: 

 For New Build Shared Ownership homes: bdht will require payment of the £250.00 reservation fee ahead of reservation. This is refundable upon completion of your purchase.

For a Re-sale Shared Ownership home: the Estate Agent can now formally agree the sale by way of issuing a memorandum of sale. bdht will issue written purchaser approval which will be required as part of the legal process. Both parties will need to instruct their own solicitors to act on their behalf at their own expense.

4. Should a mortgage be required, Bdht will need to approve the mortgage offer once it is received.

5. Continue along the legal process until legal completion with the relevant solicitors advising if any other requirements need to be met.

Once you’ve moved into your shared ownership home, you’ll have the opportunity to purchase additional shares: a process known as staircasing. Under the terms of your lease you can choose to purchase more shares of your home. 

Why should I Staircase?

There are many benefits to increasing the share of your property that you own, some being:

• If you choose to purchase more shares, your mortgage will increase while your rental payments will decrease at the same time.
• In some instances, you can purchase up to 100% of your home, in which case you would no longer pay any rent, just your mortgage along with any service charges and ground rent.
• The more of the share you own, the more you will benefit from increased property prices.

As an example, if you initially purchased a 50% share in your home and went on to buy an additional 20% down the line, you would then own 70% of the property. When this transaction has completed you would only be paying rent on the remaining 30% value of the home. This allows shared owners to build the percentage share that they own in their home and in some cases work towards 100% private ownership. 

When you’re considering a Shared Ownership home, it’s helpful to understand the potential costs involved in the process to ensure that it is the right choice for you. Please see a snapshot of expected costs below: 

Upfront Costs 

• Deposit for the purchase. When you buy a Shared Ownership home, you’ll need to pay a deposit based on the share you’re purchasing. This usually ranges between 5% and 10% of the value of your share. 

For example:
If you buy a 50% share of a home worth £300,000, your share is valued at £150,000. A 5% deposit would be £7,500 required to proceed with the purchase.

Solicitor Fees

You’ll need a solicitor or licensed conveyancer to handle the legal work on your behalf. Be sure to choose one familiar with Shared Ownership and who is approved by your mortgage lender, as your mortgage offer will need to be approved by bdht.

Mortgage Approval Fee

Bdht does charge a fee for the approval of your mortgage which is a requirement of the purchase process. 

Stamp Duty

If you’re a firsttime buyer, you may not be required to pay any Stamp Duty. However, Stamp Duty can be complex, so it’s best to ask your solicitor early in the process to confirm what you may need to pay. This can be calculated using the official gov.uk Stamp Duty calculator for guidance. 

Mortgage Broker Fees

Many mortgage brokers charge a fee, either a fixed amount or a percentage of the purchase price. Your broker should explain their fees clearly before starting any work for you.

Monthly Costs Once You Move In

Mortgage Payments

Each month you’ll make repayments on your mortgage until it has been repaid. Your payment amount will depend on:

• the size of the share you bought
• your deposit
• your mortgage term remaining 
• the interest rate

Rent

Shared Ownership homes are sold on a leasehold basis. When your lease is first issued, rent is typically set at 2.75% of the share still owned by bdht. 

Rent amounts vary depending on the share you buy and the value of the home at the time of purchase, on a re-sale property the rent amount for the same equity share as the prior owner would remain the same, increasing on an annual basis as per the terms of the lease. 

Service Charge

Service charges cover the cost of maintaining shared areas and essential services to bdht such as:

• Communal repairs and maintenance
• Building insurance
• Lifts, lighting, cleaning, grounds maintenance, door entry systems
• Estates Management fees

Service charges can increase or decrease each year, as long as the change to the charges remain reasonable.

Insurance

• Buildings insurance is normally arranged by the freeholder (usually bdht) and is usually included within your monthly service charge. This insurance covers major damage to the structure of your building, including the external walls, roof, and communal areas. It protects you against events such as fire, storms, floods, leaks, or subsidence. Please note that buildings insurance does not cover daytoday repairs or general maintenance.

• Contents insurance, which protects your belongings, is your responsibility. It’s not compulsory, but it’s strongly recommended for every Shared Owner.

Ongoing Home Ownership Costs

As a shared owner, you’ll be responsible for:

• All repairs and maintenance inside your home (as set out in your lease) Sometimes these can be covered within the initial defects period or NHBC if your property has been recently built. 
• All utility bills
• Council Tax
• Decoration 

What is the minimum deposit I will need to put down on a Shared Ownership property?

The deposit required for your new home will be dependent on the requirements from your mortgage lender. Some lenders offer as little as 5%. The deposit is worked out from the share you are purchasing rather than the full market value.

I am currently a homeowner, however the property is no longer suitable for my needs. Can I apply for Shared Ownership?

It may be possible for you to purchase a Shared Ownership property. Your eligibility would depend upon your personal circumstances and you meeting the other Shared Ownership criteria. Please contact us to discuss your individual circumstances further

Can I sublet my Shared Ownership property?

No, under the terms of your lease a Shared Ownership property cannot be sublet. It is to be your sole main residence and you should not own another property anywhere, whether in the UK or abroad.

Who is responsible for repairs to the property?

As a shared owner you will be responsible for all ongoing repairs to the property as per the terms of your lease. You may have an initial defects period if you have moved in to a new-build which would allow for the builder to return and make good particular issues. 

Can I alter my home?

Alterations can be made to your home, however we do request that permission is sought from bdht prior to any alteration taking place. External permissions may also be required, for example Building Control or Planning Permission.

What happens if I want to sell my share?

If your circumstances change and you wish to sell your property, you will need to inform bdht. The value will be set by a RICS valuation and the property would be marketed via an estate agent. You could benefit from any increase in the value based on the percentage you own. For example the property has increased in value by £10,000 you own a 50% share, therefore you would benefit from £5,000.