Frequently Asked Questions for Shared Ownership
Common Shared Ownership Questions
Here we answer some of the most common questions we are asked about Shared Ownership. If you don't find what you are looking for, please get in touch using the Contact us page.
Watch our video - An introduction to Shared Ownership
How does part rent part buy work
- What is Shared Ownership?
Shared Ownership gives you the opportunity to buy a share in a home of your own, and pay a subsidised rent on the share you do not own.
- How does Shared Ownership work?
You normally start by buying between 25% and 75% of the full value, and you may, if you wish, buy further shares until you eventually own outright.
You need to raise a mortgage to purchase your share. If you have a large deposit or equity from the sale of a property, this can also be used towards purchasing your share.
We sell new build and occasionally refurbished properties, and we also refer buyers to existing shared owners who are ready to sell their share to a new buyer.
- Which homes are available on Shared Ownership?
This will depend on schemes available at the time. To view which properties are currently available, use our Property Search.
- What size property can I buy?
You can apply for any size property.
However, in line with our allocation policy, priority may be given to households who size is more suitable for the property. For example, a couple with children may get priority over a single buyer for a three bedroom home.
- How are the properties allocated?
Once applicants are deemed eligible, priority is given to the following groups:
- Housing association and council tenants and armed forces personnel
- Local priorities, i.e. those who live or work in the borough or the sub-region (this may vary from borough to borough)
- First time buyers
- What are the costs involved with buying?
To buy you will need to be able to cover the cost of the mortgage valuation or survey, legal fees, and stamp duty (if applicable). You will need access to at least £3,500 to £4,500 in savings. In most cases buying a home involves paying a mortgage deposit, which is in addition to the £3,500 to £4,500 needed to cover the costs of buying. The amount of the deposit required will depend on the mortgage provider you chose, the terms of the mortgage and your credit rating.
Every month, you will need to make the following payments:
- Your mortgage repayment, which you make to the lender
- Your rent, which is set at a low rate to help make your home affordable. You pay your rent to your housing provider, based on the share of equity that you are yet to buy
- If you buy a flat (or house on an estate with shared areas), you will also pay a service charge for maintenance and upkeep of these common parts
- Do I have to pay Stamp Duty Land Tax?
When you buy a share in a property through an approved Shared Ownership scheme you may have to pay Stamp Duty Land Tax. You can find more information of Stamp Duty for Shared Ownership properties on the HM Revenue and Customs website.
- Can I buy my share with cash only?
To buy through Shared Ownership you will need to do what is known as 'maximise your affordability'. What this means is that you will be required to take out a mortgage in addition to any deposit you may have. Even if you can afford to buy the minimum share of the property in cash, you will still be required to take out a mortgage. The rule may be waived for people who can't get a mortgage due to age or disability.
Shared Ownership Eligibility
- How do I know if I am eligible?
Family Mosaic has general eligibility criteria, which all applicants must meet. It is worth noting that in addition to this, individual properties and developments may also have eligibility criteria specific to them - this will be detailed in the property listings on our website.
Read more on our general eligibility criteria here.
- Who can apply?
Anyone who cannot afford to buy a suitable home on the open market, but who meets the general eligibility criteria and can afford to sustain the costs related to Family Mosaic schemes can apply.
As well as our priority groups, namely social tenants, MoD personnel and those home seekers identified as priority by their Local Authority, we also accept applications from other first-time buyers, this includes:
- People living with parents / relatives
- People living in private rented accommodation
- People who need to move for work reasons
- Homeless people or those living in temporary accommodation
- Do I have to live or work in the borough in which the property is located?
No, however priority is given to those applicants who live and/or work in the borough in which the property is located over those who currently live or work outside it. Secondary priority is given to those applicants who live or work in the neighbouring boroughs.
- I have a poor credit rating - am I still eligible?
You will need to re-build your credit rating before you can buy.
If this issue affects you it is best to inform us of your situation before you go to view a home.
- I don't have UK / EU / EEA citizenship, or indefinite leave to remain - am I still eligible?
You are eligible to rent (providing your leave to remain covers the rental period). It is possible for you to buy through Family Mosaic, providing you can demonstrate you are able to take out a suitable mortgage, and maintain payments. This will be assessed on a case by case basis, usually by a Mortgage Advisor familiar with the both the schemes and lenders requirements.
- I own a property abroad; can I still apply for Shared Ownership?
Unfortunately you are not able to purchase through Shared Ownership.
- Can a family of 2 adults and 3 children apply for a 2 bedroom property?
No they can't as they will be instantly overcrowding themselves, they will only be eligible for a 3 bedroom property.
- Can I still apply if I earn slightly less than the minimum income requirements as per the price list, however I have minimal outgoings and have a larger deposit to put down?
Yes you can apply; you may wish to speak to a Mortgage Advisor for the development over the phone first as well.
- I meet the Shared Ownership eligibility criteria, what happens next?
Your next step is to start looking for a home. If you see a property listed that you think you might be interested in, you can register your interest in the property via the website or use the contact details in the listing to arrange a viewing. The contact person will be able to answer any questions you may have about the property.
After you've purchased a Shared Ownership home
- What are my options after buying through Shared Ownership?
You can buy additional shares at a later date until you own 100%, if you wish to. This is called staircasing and the cost of the additional shares is based on the market value of the property at the time that you purchase the shares. If you increase your share in the property, your rent is re-calculated and reduced proportionately. Normally, you will be able to staircase as and when you can afford to.
If you wish to sell your property, your share is marketed for sale by Family Mosaic to allow other people in housing need to benefit from low cost home ownership. The property is resold at the market value of the property at the time of resale.
- Are there any time restrictions on when I can staircase or sell my property?
There are no time restrictions on when you can staircase or sell your property, however for staircasing transactions you will need to prove your affordability to purchase more equity.
- What happens if I start a family and need a bigger home than the one I currently own?
You may be eligible to apply again and buy another home if you are in housing need, have Local Authority support from the borough that you are resident in and have sold your home prior to applying to Family Mosaic. You should not spend any money on buying another property until you have had your application assessed and your eligibility confirmed. In order to be eligible you must still need government assistance to be able to buy a property suitable for your needs.
- Can I take in a lodger to help with costs?
No. You need to be able to afford the costs of buying the home yourself. You will have a financial assessment carried out by a Mortgage Advisor prior to buying your home - the Mortgage Advisor will verify that the costs of home ownership are affordable for you.
- Can I sublet my home?
No. Government money goes into affordable home ownership schemes, so we have to control who benefits from it. Also, if you have a mortgage on your home, your lender will probably be concerned if you let it to someone else.
If you need to go abroad for work purposes then Family Mosaic may give you discretional permission, however the rent cannot be more than your current service charge, rent and mortgage payment combined.
- Can I carry out home improvements?
Generally, yes. Obviously, you can carry out minor work such as putting up shelves or decorating without consulting us. If you plan to carry out major work, such as double glazing, taking down or putting up a wall or building an extension, you'll need our written permission.
If you are doing structural work to your home we'll need to see plans. You should also write to us and confirm that the work will be carried out by a reputable builder and will meet all necessary building regulations and planning requirements.
If you are planning to carry out any major improvements to your home you should remember that your home won't always go up in value by the amount you spend on improvements.
For further information about home improvements, please contact our customer care line on 0300 123 3456
Many developments now have communal heating systems. If your development has this or a similar system you should not interfere with plumbing, i.e. kitchen or bathroom alterations without our approval. Doing this without our permission could affect the whole development and the repair costs could be considerable which you would have to pay if found to be through your fault.
- Can I keep pets?
Your lease will tell you if you can keep pets in your home.
If you live in a house there are not usually any restrictions.
If you live in an apartment you are unlikely to be able to keep a pet.
Occasionally we may allow you to keep a pet even if your lease does not allow you to (although we'll need to know what type of pet you want to keep). If we give you permission to keep a pet you must make sure it doesn't cause a nuisance to your neighbours. If it does, we may withdraw our permission and you'll no longer be allowed to keep a pet.
More purchasing options
- If I am not eligible for help from Family Mosaic, are there any other options available that might help me?
Share to Buy provides details of Shared Ownership properties in London currently available to purchase from all Housing Associations. You can search for other Shared Ownership properties at www.sharetobuy.com.
You may be able to be housed through the Council's Choice Based Lettings. You should contact your local Council for further information.
If you are a council or Registered Provider tenant you can check with your landlord to see if they can help. You also consider the options offered at www.homeswapper.co.uk
For social tenants, some options that may be available to you include:
- Social HomeBuy
- Right to Buy
- Right to Acquire
If Family Mosaic is unable to accept your application as it has been deemed your income and/or savings are too high then you may be able to rent/buy on the open market. To find out more information about buying you can contact a Mortgage Advisor. To find out about rental properties you can go direct to an estate agent.
Family Mosaic as a provider of Shared Ownership
- Is Family Mosaic the same as the council?
No, we are an independent organisation, but we do work closely with councils.
- Is Family Mosaic a private company?
No. Family Mosaic has charitable status and any profits made are re-invested back into homes and service improvements.
- Do you manage housing for private landlords?
- Can I use housing benefit?
You are unable to use housing benefit to buy or rent a Family Mosaic home.
- Does Family Mosaic offer mortgages?
No, you will need to contact an independent lender to obtain a mortgage. For more inforamtion you will need to contact a Mortgage Advisor.
- Does Family Mosaic offer help with a deposit?
No, you will need to have savings to cover the deposit for your mortgage.
Further Shared Ownership questions
- Do I have to see Family Mosaic's Mortgage Advisor even if I have my own Mortgage Advisor or have a Mortgage in principle?
Yes you will still need to go through an affordability assessment with Family Mosaic's Mortgage Advisor; once you pass the assessment then you may go with a Mortgage Advisor of your own choice for your mortgage.
- How is the rent calculated?
In 2001, the Government introduced rent restructuring rules. We follow these rules to work out your rent using a Government formula. We have to allocate your rent to what is known as a 'target rent'. The formula applies to rents only (not service charges).
Your rent is based on:
- the average earnings for the area compared to the national average
- the number of bedrooms in your home
- the value of your home in January 1999
- the national average housing association property value in January 1999.
The Government limits the annual increase to 0.5% in addition to the Retail Price Index.
Each year, our Group Board, which includes residents, approves our budget including rent levels and rent increases.
In the following example, we have assumed a Retail Price Index (RPI) figure of 1.0%.
Imagine the rent on a home is £100.00 a week and the Retail Price Index (RPI) is 1.0%. The new rent would be:
Existing rent of £100.00 plus the RPI of 1.0% (£101.00) plus the additional 0.5%, giving a new rent of £101.50
Please note this is based on current requirements, older leases may have a different annual increase percentage above the Retail Price Index. If you are buying a resale, ensure you check this with your legal advisor.
- How is the service charge calculated?
The service charge is based on expenditure for maintenance of the development. In the first year after a new development is completed the developer is still responsible for some of the repair work so this can mean it is cheaper during this period.
- Are the rent and service charge fixed?
The rent and service charge are reviewed on the 1st of April each year and are in line with the cost of inflation. The rent is calculated via the Retail Price Index (RPI) plus 0.5%. The service charge can be influenced by whether the developer is still responsible for maintaining at the development so can be less in the first year. Please note this is based on current requirements, older leases may have a different annual increase percentage above the Retail Price Index. If you are buying a resale, ensure you check this with your legal advisor.
- Can my parents act as guarantors for the rent and service charge?
No third party can act as guarantors. Family or friends can only gift the deposit to purchase the property.
- What do my service charges pay for?
Service charges cover the costs of maintaining communal areas. You can read more in our Guide to Shared Ownership.
- Who is responsible for repairs and maintenance?
As the homeowner, it is your responsibility to repair and maintain your new home. New homes often come with a guarantee that will cover defects in your home for the first year after it was built - the guarantee usually only covers defects in the builder's workmanship.
- Who pays the Council Tax?
It is your responsibility to pay the Council Tax. You can find more detail on council tax here.
- How long is the average time frame from viewing the property to moving in?
Normally if an apartment is already handed over from the builders then the process will take around 8 weeks, however if you are purchasing off plan then the process may take longer and will be dependent on when Family Mosaic takes handover of the development.
- What is the maximum or minimum share I can buy?
Will be dependent on the scheme but usually between 30% and 75%.
- Can I choose what share I want to buy?
Yes, provided you are not buying outright and that you are buying more than the minimum share required for the property. It is recommended that you purchase the greatest share that it is affordable for you to.
- Is there parking available?
This will be scheme-specific, although most developments are car-free schemes. An application may be submitted to the local borough council for a parking permit, if there are spaces nearby the development.
- What happens if I die after buying a Family Mosaic Shared Ownership home?
If you die, your home will be passed on in the normal way under the terms of your will. If you have not made a will it will pass under the laws of intestacy.