If you’re looking to purchase your first property, particularly in this current unpredictable economic climate, it most definitely isn’t one of the easiest roads to head down. Much of the time, first time buyers seem to find themselves at dead-ends when finding ways in which they can purchase a home.
Many first time buyers are bound to face what might seem like endless hurdles, whether it be gathering a large enough deposit to put down or perhaps your income isn’t quite enough at this stage. An option that is open to those in this situation but many may not be aware of is shared ownership, whereby buyers are able to purchase shares in a property and pay rent on the remaining share, which works perfectly for those who may find themselves unable to find a lump sum of money at one specific time to put towards a new home.
Shared ownership properties are sold through housing associations. You have the ability to purchase a stake of between 25% and 75% of the property, using a deposit and a mortgage. You then pay “rent” on the remaining share, which remains owned by the local housing association.
In a nutshell, shared ownership is a convenient, affordable way to allow people to purchase a new home. The “part buy/part rent” procedure means that eventually, you will own the property but at your convenience, with the opportunity to buy more shares of the property until it is yours outright.
Shared ownership is now open to first time buyers and existing share owners in any occupation, however income considerations tend to vary depending on different regions. Although a deposit is still required, it will be much smaller than the normal, expected deposit for a house purchase, as you will only be putting down a deposit for the share you will be buying. The same goes for the mortgage on the property – a mortgage is required only on the share you will have purchased, meaning that all round, the process is as affordable as possible for you.