Frequently asked questions
What is shared ownership?
Shared ownership schemes are a cross between buying and renting; aimed mainly at first-time buyers. You own a share and then rent the part you don't own at a reduced rate.
Shared ownership is designed to help people who can’t afford to buy a property outright. It allows you to buy a share between a quarter to three-quarters of your new home. You have the option to buy a bigger share in the property at a later date. There will be a subsidised rent on the part you don’t own.
Shared ownership homes are offered at a leasehold only basis, which will usually be 99-125 years for new homes. If you are buying a re-sale property, the length of your lease will be based on the number of years that would have been left on the original lease.
What will I own?
You will own the equity (share) of the property you purchased, based on a long lease. A lease is a legal agreement between you and the landlord. The lease is usually based on ‘a model’ lease published by the Homes and Communities Agency. It covers you and our responsibilities including maintenance, rent-setting, buying more equity, selling the property and buildings insurance.
Why buy through Shared Ownership?
If you buy through Shared Ownership, you will own part of your home rather than just paying rent with nothing to show for it. Your monthly mortgage and rent can work out cheaper than buying outright, and sometimes not more than renting. You can buy more shares at a later date (known as ‘staircasing’) or move if you want to.
How do we select buyers for shared ownership?
You can apply for Shared Ownership if you can’t afford to buy on the open market.
We give top priority to:
The criteria for who’s eligible for the shared ownership scheme in England are:-
We give top priority to:
- You are a first time buyer
- You rent a council or housing association property
- You are already living and working locally
- Priority given to military personnel
- Your single or combined income is less than £80,000 (in London, it’s less than £90,000)
If you are privately renting or living with your family or friends, you can still apply. Even if you have owned a home before, you may be able to buy through shared ownership if:
- You owned a home with a partner, and that relationship broke down or your home became unsuitable for your needs.
- You need to move because your job is moving.
- You are already a shared owner who needs to move and you meet all our other conditions.
If you’re a council or housing association tenant, you will have to give up your tenancy when you buy with us.You will not be able to apply if you have been behind with your rent in the past six months, or you are already named on a mortgage or property deed.
How do I apply?
The demand for shared-ownership homes is often more than the number of properties available. So it is possible that we may not be able to help you even if you qualify. However, we will always tell you what the situation is.
Buying a shared-ownership home can sometimes seem complicated but don’t worry, we are experts and we’ll give you all the help you need. This can include filling in the forms, and putting you in touch with solicitors and specialist mortgage advisor who can help you find the right mortgage.
NU living is the sales agent for Swan Housing Association Shared Ownership.
If you would like to apply for one of our current developments please register your interest through our online form. If you are interested in one of our future developments, you can register your interest on the contact us page of this website and we will email you details nearer to the time of launch.
How much do I have to earn?
There is a lower income limit for each home we sell. The amount will depend on the size of the home and where it is. Also, you should not be able to afford to buy the home outright in the area you are seeking your shared ownership home.
Is there an upper limit on my earnings?
Yes, your single or combined income is less than £80,000 (in London, it’s less than £90,000). To find out if you qualify, you will need to have an assessment with a specialist mortgage advisor. We will offer you the highest share you can afford to buy. You have to buy as much as you can afford, which means you could own up to 75% of the property straight away.
Must I have a job?
Yes. You must have been in a permanent job for at least six months or have passed any trial period. If you are self-employed, you’ll need to have three years’ audited accounts.
Will you check my finances?
A detailed credit check will be carried out before we offer you a home. So if you have ever had a County Court Judgment (CCJ) against you or if you have failed to meet the repayments on a loan, we may not be able to help. However if the CCJ has been cleared then it will be dependent on the individual lenders criteria. An assessment with our recommended specialist mortgage advisor will be able to clarify under this circumstance.
What is the cost of shared ownership?
Once you have cleared the financial assessment and have identified the home you wish to purchase, you will be able to pay a reservation fee of £500. If do not complete your purchase, we will keep this fee on a sliding scale (25% reduction per week) depending on the stage of your purchase, this is to cover our legal and administrative costs.
Documents required at point of reservation:-
When you reserve your property, you will also need to provide some further information please see below:
- Proof of identity (passport or driving licence)
- Last 3 months bank statements
- Proof of your savings
- 3 months proof of income or 3 years accounts for self employed
- Proof of address – council tax bills, utility bills (not mobile phone bills)
Survey and valuation report
Your mortgage lender will want to make sure that the property you are buying is in reasonable condition and worth the money that we are asking you to pay. They will want to carry out a survey on the property before you buy and there may be a cost required by your lender for this.
You will also need a solicitor to act for you, and some solicitors charge more than others. However, as a general guide, you should normally allow around £1,000 for solicitors’ fees. We can normally advise you of a solicitor experienced in shared ownership conveyancing. Other fees that will also need to be paid are as follows:
- Stamp Duty and disbursements
- Stamp Duty liability will be advised by your solicitor
- Mortgage deposit payable on exchange of contracts
Any rent and service charge due for the time between completion and the end of the month, and one full month’s rent and service charge in advance.
You must exchange contracts within 28 working days from when your appointed solicitor received legal papers.
You should have at least £4,000 set aside to meet the costs given above. This could be more, depending on the location and price of your home.
What do I do if I want to buy a property?
Once you have decided on the home you would like to buy, you will need to make a direct application with NU living. Please contact us on 020 3369 0115.
1. Financial interview
An initial conversation with our recommended specialist mortgage advisor is required prior to reserving and paying a reservation fee.
2. Reserving the property
For newly-built properties, we will need you to pay a reservation deposit of £500. We will take this off the cost of the share you buy once the purchase is completed. If the purchase does not complete, you will not get this deposit back as this will go towards covering administration costs.
3. Arrange a mortgage
You must arrange for a Shared Ownership mortgage from a provider of your choice.
4. Find a solicitor
You will need to have a solicitor and ask them to act on your behalf in the purchase. (fees are payable for any legal services) We can recommend a solicitor for you who will be experienced in Shared Ownership properties.
5. Mortgage offer
Once you receive your mortgage offer, you should send us a copy for our approval before exchange of contracts.
6. Exchange of contracts
When we have all the information we need, we will give our consent to the purchase. Once we do this, your solicitor may be able to go ahead with the exchange of contracts. We suggest you contact your solicitor at this point to see how things stand. We should expect that the exchange of contracts will be within 28 working days of your solicitor receiving legal paperwork from us.
You will need to discuss the completion date with your solicitor. The completion date is the day from which you become the new owner.
Can I buy a bigger share in my home?
Yes, this is called ‘staircasing’. You do not have to buy more shares; it’s up to you to decide what’s right for you. To staircase you will have to buy at least 10% share of the value of your home at the time of staircasing (Please see your lease details of any restrictions which may apply). As you only part rent on the part you do not own, it means the more equity you own, the less rent you pay. And if you buy your home outright in the future, you won’t pay any rent. If the property you buy is a house, you will usually be given the freehold if you buy it outright. This means you don’t need to worry about your lease running out one day.
If you decide to buy more equity, the cost will be based on the value of your home at the time. We will use an independent valuer approved by the Royal Institution of Chartered Surveyors. You will have to pay for this valuation. You may use your own valuer instead, but they must be approved by the Royal Institution of Chartered Surveyors.
What happens if I want to sell?
Just like any other home owner, you may sell your home whenever you want. To make your home available to other people who can’t afford to buy outright, we will, for a short time, have the right to find a buyer for your home. We charge a fee for this service. Your lease will say how long we have this right for.
If we are unable to find a buyer within this time, you are free to make your own arrangements to sell your home. If you decide to sell, we will ask an independent valuer, approved by the Royal Institution of Chartered Surveyors, to value your home. Or, you may want to use your own valuer. If so, they have to be approved by the Royal Institution of Chartered Surveyors. You will have to pay for the valuation. The price you sell your share for will be based on this valuation.
The assessment is to make sure you can afford the property, and to work out the maximum share that you will be able to buy. You will also need to show us proof of your savings, employment and earnings, as well as some personal information such as your National Insurance number and passport details.
What are the costs once I've moved in?
Mortgage and rent
If you have taken out a mortgage to buy your home, there will be a monthly mortgage payment. There will also be the monthly rent you pay to us on the part you do not own. You pay this in advance by Direct Debit. Your rent will go up each year on the 1st April in accordance with your lease.
With most properties, and always with apartments, there will also be a service charge. This covers the cost of maintaining the outside of the building and any shared areas. It may also include a payment towards a ‘sinking fund’. This is to make sure that if any major work is needed on the shared areas or to the outside of the building in the future, you will not have to find a large amounts of money to pay for these. You will still have to pay the service charge even if you buy your property outright in the future.
As part of the service charge there is a management charge which covers the cost of the leasehold management team. The cost of your share of the buildings insurance is also included in your service charge. This insurance does not cover your belongings and you should arrange your own contents insurance. You will be responsible for your household bills - for example, your Council Tax and utility bills.Repairs, maintenance and improvements
As a shared owner, you are an owner-occupier, not a tenant. If you live in a house, you are responsible for all repairs to your own home. Your responsibilities and ours are set out in the shared-ownership lease which your solicitor will explain fully before you buy. If you live in an apartment, you are responsible for all maintenance inside your home. We will maintain the outside of your apartment and you will pay for this through a service charge.
If you want to make an improvement to your property, you must contact the Leasehold Management Team and ask for their permission before you start work.
Leasehold Management contact:
Phone: 0300 303 2500
Email: [email protected]
Monthly costs checklist:
- Mortgage repayments
- Rent and service charge
- Council Tax
- Gas, water, electricity, phone
- Contents insurance