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Can you buy shared ownership outright?

Can you buy shared ownership outright?
Pete Mugleston

Author: Pete Mugleston - Mortgage Advisor, MD

Updated: July 5, 2022

Can you buy shared ownership outright?

The short answer is yes. But you will need to understand how the scheme works and be aware of some of the pitfalls.

When you first enter into Shared Ownership, you can set your share at between 30% and up to a maximum of a 70% ownership in the property. You then pay ‘rent’ for the remainder of the share to the housing association.

This means that you would not be able to own a shared property outright from the very beginning, but this is possible down the line.

How to buy 100% of a Shared Property

There is a way of achieving full ownership of a Shared Ownership property through a process called ‘staircasing’.

What this enables you to do is to buy more shares in your home by making lump sum payments of 10% or more. For instance, if you own 60% of the property you could make four payments of 10%, two payments of 20% or a single payment of 40%.

The advantage to doing this is that the ‘rent’ you pay will be reduced. And will become zero when you achieve 100% ownership.

Are there any downsides to 100% ownership of a Shared Property?

One downside is that there may be some fees incurred through ‘staircasing’, such as valuations and solicitors fees and these will be payable each time you ‘staircase’, although these should be lower than when you bought your initial share.

Be aware that with 100% ownership, you may also be required to start paying ground rent, so you should contact the housing association to see whether it is required under the lease agreement and how much it will be.

Are there properties that you cannot ‘staircase’ to 100% ownership?

Yes. You’ll find that some schemes do not allow 100% ownership.

These are primarily developments that have been specifically designed for people with particular needs, and have incorporated features such as on-site care facilities for the elderly.

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of the most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs.

Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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