Shared Ownership Schemes

Housing associations and charitable trusts sometimes offer first-time buyers - who may be single parents, single people or students - the chance to part-buy/part-rent low-cost properties.

The main principle is that you buy a percentage of the property (say 50%) and you rent the rest from the housing association, with a service charge if it is an apartment. As time goes by you can 'staircase up' to 100% ownership. This scheme is specially designed for those who cannot meet the full cost of outright purchase straightaway. Usually, your total monthly outgoings are smaller than they would be if you purchased outright.

Conditions associated with shared ownership include:

• You will need to pay of a reservation fee, usually a couple of hundred pounds, which is non-returnable but does go towards the price.
• You will also need to arrange a mortgage to buy your share of the property.
• Your mortgage lender will carry out a valuation report, which will cost you around £150.
• You'll need to appoint a conveyancer to carry out the transaction. This may cost around £400.
• When you move into the property, you will be paying a mortgage to the lender and some rent to the association each month.
• After you have lived in the property for a certain time, you can buy more shares in it (until your own it outright), or sell your shares back to the association (at a fair market rate).
• Once you own the property outright, you can sell it on the open market.

Most local authority housing departments have lists of shared ownership schemes in their area. If you are eligible for a particular scheme you can fill in and submit an application form. If you are accepted, you will be offered a vacant property or put on a waiting list.