Shared-ownership rules to be relaxed: 175,000 more Londoners will be eligible for part-buy schemes from April

From April, a shake-up of the shared-ownership rules will offer a lifeline to struggling home buyers who can take advantage of five per cent deposits and stamp duty savings.

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A shake-up in the shared-ownership rules aimed at helping young Londoners on to the property ladder begins in April, when 175,000 more will become eligible to take this route to home ownership. 

Local councils currently dictate who should take priority for shared ownership based on a wide range of factors — from salary to occupation and location. But no longer will public sector “key workers” such as firefighters and police officers have official priority.

Under the new rules:

  • Existing property owners, including divorcees and couples upsizing to a family house, will be able to apply and will be given equal status.
  • There will be no limit on the number of bedrooms in a home that is bought.
  • As long as you do not earn more than £90,000 — previously £71,000 — you will qualify, in recognition of the capital’s high property values.

Shared-ownership: how it works

The shake-up aims to reverse the decline in home ownership at a time when Londoners’ property options are shrinking. Public housing is scarce, private renting is becoming more expensive, while the big deposits demanded by mortgage lenders are locking out first-time buyers.

Shared ownership allows people to part-own and part-rent their homes. The scheme operates through housing associations. People can buy from 25 to 75 per cent of a property, using a comparatively small deposit and mortgage, and rent the remaining “un-owned” share.

Normally, total monthly outgoings are less than when buying the same property outright because the rent is subsidised.

Owners can gradually buy more of their home as and when they can afford it, a process known as staircasing. There are stamp duty savings, too.

Is shared-ownership set to soar?

While there are some potentially negative factors to consider — see our “downside” panel, below — the changes could propel shared-ownership into the housing mainstream, and have been seized upon by the main candidates for this May’s London mayoral election, who have declared housing the most important issue.

Labour’s Sadiq Khan wants to boost shared ownership and says he will give priority to people who have been renting privately for more than five years.

Conservative candidate Zac Goldsmith has pledged to build 50,000 homes a year by releasing more public land for affordable housing, including shared ownership. A register of public land recently listed 40,000 sites in London with development potential to deliver 130,000 homes.


From £90,000: for a 25 per cent share of a flat at Walpole Lodge in Putney. Call 020 8354 5500


How to buy with a deposit of less than £5,000

Shared ownership is one of several government initiatives and arguably is the most compelling for buyers who do not have a large deposit. They need only put down five per cent of the share being purchased.

In many cases, this amounts to a deposit of less than £10,000, and sometimes less than £5,000 — as at Spectrum, for example, a scheme close to Lee train station in south-east London, where a deposit of £4,525 is required when you buy a 25 per cent share of a home for £90,500. Call Affinity Sutton on 0300 100 0303.


Greenwich Peninsula: one-bedroom riverside flats cost from £87,500 for a share. Call Moat on 0845 359 6330


Shared-ownership: the downsides

  • As well as monthly mortgage and rent there’s a service charge, which can be high in a block with amenities such as a pool or a gym. 
  • Sub-letting, even informally renting out a spare room, is usually forbidden under the lease. 
  • Buyers must do their own due diligence in terms of location, price and what the neighbours are like. 
  • You can sell your share at anytime, though it is not always as easy as a normal open-market sale. Often housing associations have right of first refusal, typically eight weeks to find a buyer, and will get a surveyor’s valuation. 
  • Once sold, you pay a minimum 1.25 per cent of full market value, similar to an estate agent’s fee. With high demand, it is easier to sell on than it used to be.
SW18: one-bedroom flats are priced from £182,000 for a 40 per cent share at Battersea Reach


Help to Buy: an alternative scheme for cash-strapped first-timers

Help to Buy offers an equity loan of up to 40 per cent when buying a new home from a volume house-builder. But buyers have to put down five per cent of the full purchase price.

Housing associations are rolling out more shared-ownership schemes, but there is still a huge undersupply of homes, meaning buyers face stiff competition.

The best way to proceed is to register with the Mayor’s First Steps programme on Then you can search not just by area, but by deposit and budget.


Martin Husar bought a 30 per cent share in a one-bedroom flat in Lambeth


Sales executive Martin Husar, 27, had been renting privately in west London for four years and considered leaving the capital because he was unable to save a big enough deposit to buy a home on the open market.

Shared ownership allowed him to get on the ladder in Lambeth, close to the Houses of Parliament and the Southbank Centre. Mr Husar bought a 30 per cent share in a one-bedroom flat at a listed former school, where Guinness housing trust was offering homes.

"It’s a quiet residential area yet unbelievably close to all the action,” he says. “The remarkable thing is that my monthly outgoings are lower, and I can continue saving. I will keep buying a bigger and bigger share until I get full ownership.”


Housing to suit every budget: integrated developments offering affordable and expensive homes

Buying a shared-ownership home does not mean compromising on quality or location. Homes are available in posh postcodes as well as grittier inner London and suburban high streets.

Planners demand that affordable housing is integrated with more expensive private housing, so often flats are for sale at swish developments where open-market homes cost millions of pounds.

At Battersea Reach, one-bedroom flats are priced from £182,000 for a 40 per cent share. This scheme has dramatic glass-clad blocks fronting the Thames, a new promenade, communal gardens, bars, restaurants and residents-only gym. Call Notting Hill Housing on 020 8357 5222.

The Jessops building at New Providence Wharf in Docklands has flats from £96,563 for 25 per cent. Call Genesis on 0800 954 0040.

At Greenwich Peninsula, one-bedroom riverside flats cost from £87,500 for a share. Call Moat on 0845 359 6330.

At Walpole Lodge, Putney, flats start at £90,000 for a quarter share. Call Octavia Living on 020 8354 5500.

And at St Agnes Place, backing on to Kennington Park in Zone 1, three-bedroom houses cost from £250,000 for a 25 per cent share (L&Q; 0844 406 9800).

Marilyn DiCara, director of Moat Homes, says the revised eligibility rules are a lifeline. “There’s huge demand from young professionals in finance, IT, retail, science and medicine, health and beauty, the media and charity sectors, also the Civil Service.”



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