5 popular myths debunked
You don’t really own your home
This isn’t the case. Shared ownership sees you buy a share in your home and pay rent on the share that you don't own. It means you can take that all-important first step to joining the property ladder using a smaller deposit and mortgage.
You can’t afford it
There’s no getting away from the fact that buying a home, or in this case a share in one, is probably the most expensive and important purchase anyone will ever make. But shared ownership exists to ensure home ownership isn’t just an impossible dream reserved for a privileged few. In fact according to the latest figures from the National Housing Group, the average UK household income for a shared ownership buyer is £30,347.
Share options are designed to be flexible, so depending on the scheme, the type of property you want to buy and where your new home is located, shares as low as 25% are available. This also removes the problem of finding a huge deposit – one of the biggest barriers to buying a home in the current climate.
You’ll be paying a mortgage and rent forever
Here’s one of the most common misconceptions: you will never own your home outright. But that’s not correct – in almost all cases, you will be able to buy a larger share in your home, or even all of it at some stage if you want to. This is known as ‘staircasing’, and the beauty of it is that you can build up your share over time in an affordable way. And, the larger the share of your property that you own, the less you will have to pay in rent, helping you to get your mortgage paid off quicker.
You aren’t eligible
Even if you have looked into shared ownership before and found you weren’t eligible, you may be now. The eligibility criteria for shared ownership purchases changed in January 2016 so it is now open to many more people than before. Here are some of the key changes:
- The household earnings threshold has risen from £60,000 or less a year to £80,000 or less a year (or £90,000 or less a year if you live in London)
- You’re no longer restricted on the size of property you can buy – as long as you can afford it, you can buy any sort of shared ownership home you like
- Shared ownership homes are now offered on a first-come, first-served basis – the only exceptions include priority continuing to be given to MoD personnel, or if the local authority for the area that you want to buy in requires you to have a local connection.
You’re stuck with a home that’s not yours to sell if you want to move on
You can sell your share in your home at any time if you wish – you just need to inform the housing provider which owns the remaining share of the property formally in writing. As a part owner of the property the housing provider has first refusal on the opportunity to buy the property. If you own 100% of the property you can sell it yourself privately.
To view shared ownership properties available in your area visit our sales pages or message @Sales_Aster on Twitter.