By providing a flexible approach to home ownership that opens up the possibility of purchasing your home over time, it creates opportunities for people who are struggling to get a large house deposit together.
However, it’s important you’re clear how Shared Ownership works and properly weigh the pros and cons.
Pros of Shared Ownership
- It’s easier to get an affordable mortgage with a lower deposit as you are only purchasing a portion of the house. This means more manageable monthly payments.
- You can staircase to buy more shares when you are ready, but there’s no pressure to do so.
- You can sell the share you own in your home, much like selling a home you own outright, whenever you want.
- Shared Ownership properties are leasehold. Under the New Model Lease the lease length is 990 years.
Potential cons of Shared Ownership
- As well as mortgage payments, you will also have to pay service charges and rent on the remaining share of your property.
- Whatever share you own, you are fully responsible for decorating and maintaining the property.
- There may be some restrictions on the kinds of home improvements you can make. While decorating is fine, structural changes usually require approval.