Shared ownership explained: how it works and who it’s for
Buy a share of a home (usually 25–75%) and rent the rest - shared ownership can get you onto the ladder with a smaller deposit. The full pros, cons and costs.
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Shared ownership lets you buy a share of a home - usually between 25% and 75% - and pay rent on the rest. It is aimed at people who can afford a mortgage but not a whole property, and it can get you onto the ladder with a much smaller deposit.
How it works
You take out a mortgage on your share and pay subsidised rent on the part you don’t own (typically around 2.75–3% of the unowned share’s value per year). You own your share outright - it’s yours to sell, though the housing association usually has first refusal. Over time you can buy more shares - called staircasing - up to 100%.
Who qualifies
- First-time buyers, or previous owners who can’t afford to buy now
- Most schemes cap household income at around £80,000 outside London and £90,000 in London - check your local provider’s exact rules
- You must be unable to afford a suitable home on the open market (the provider checks this)
- New-build homes, usually leasehold, through a housing association or developer
The costs
| Cost | What to expect |
|---|---|
| Deposit | 5–10% of your share (not the full value) |
| Rent on unowned share | ~2.75–3% of that share’s value per year |
| Service charge | £50 – £200+ per month (leasehold) |
| Stamp Duty | Pay on the full market value OR on each share (see below) |
| Staircasing costs | Valuation + legal fees each time you buy more |
The pros and cons
| Pros | Cons |
|---|---|
| Smaller deposit needed | You only own part - the rest is rented |
| Below-market rent on the rest | Ground rent and service charges on top |
| Staircase to 100% when you can | Leasehold terms (and lease length) matter |
| First refusal rights for providers | Selling can take longer (provider must decline first) |
Is it right for you?
Shared ownership works best for people with a steady income, a modest deposit and plans to stay put for a few years. It’s less flexible than full ownership: moving is slower, and the rent plus service charge plus mortgage can add up. Get the full breakdown in writing from the provider - rent, service charge, ground rent and any future increases - before you commit.
Source: GOV.UK - shared ownership — Scheme rules checked August 2026
Source: MoneyHelper - shared ownership — Costs and staircasing guidance checked August 2026
How much deposit do you need?Deposit sizes and where the money can come from.Leasehold vs freeholdShared ownership homes are usually leasehold - know what that means.
Sources
- GOV.UK - shared ownership - Scheme rules checked August 2026
- MoneyHelper - shared ownership - Costs and staircasing guidance checked August 2026
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