Shared ownership is another means of securing a new-build home.
Simply put, shared ownership is a mixture of buying and renting a property and available to all buyers, but especially useful for first-time buyers.
Shared ownership is another means of securing a new-build home. But what is it? Read our latest guide to find out everything you need to know and about the shared ownership partners we have here at Tilia Homes.
Shared ownership schemes help a lot of first-time buyers to secure a new-build property by buying part of it and renting the other for a smaller upfront payment.
Buyers are able to purchase between 25-75% of the home’s market value and pay a subsidised rent on the remaining share, calculated at 2.75% per annum. You’ll also need a deposit of at least 5% of the share you intend to buy.
You can then choose to purchase more shares of the home when you’re ready and as soon as you own 100%, the home will stop being leasehold and become a freehold property.
An agreement or mortgage in principle does not, however, ensure that you will be approved for a mortgage with a provider. You will still need to go through the entire approval procedure when you submit a legitimate application at a later time.
Much like buying any other home, you may need to apply for a mortgage. There are in fact shared ownership mortgages to cover the amount you intend to borrow.
Not all lenders offer these products, however, and so you’ll need to research which will be able to offer the product you need.
Deposit rates tend to vary depending on different lenders, but a 5% deposit is the minimum you’ll need.
You can use our Mortgage Calculator to calculate how much you can afford and to see how much the monthly payments would be for your dream home.
The eligibility criteria for shared ownership can vary depending on the provider and the property. These include:
• Your household yearly income must be below £80,000
• You currently do not own a home
• You must be at least 18 years of age
• You must have proof you’re not in mortgage or rental arrears
• You have a good credit history
• You’re not able to purchase a home suitable for your needs on the open market
Alongside the typical mortgage fees and charges associated with buying a new home, there are other financial considerations including stamp duty, solicitor fees and moving costs for first-time buyers to think about.
If you’re interested in buying one of our new build homes, then you can do so using shared ownership initiatives.
Our partnerships with Sage Homes and Heylo, offer part-buy-part-rent opportunities through their Home Stepper and Home Reach schemes, respectively.
If you have any questions about a shared ownership property, or you’d like to know more about our offers and make an enquiry, please do not hesitate to get in touch.
Our teams will be able to assist you with your enquiries and you can find out contact details here.