Shared ownership conveyancing solicitors

With rising property prices and the increasing cost of living, first-time buyers are finding it difficult to get on the property ladder.

The shared ownership scheme helps bridge the gap between a lack of wage increase and property price rises. People who don’t earn enough to maintain a regular mortgage or struggle to save for a deposit can use this affordable home ownership scheme to buy a shared ownership property, or at least a significant share in a property.

The shared ownership process

Shared ownership offers a way to buy a portion of your home and pay rent on the rest. Before diving in, you’ll need to check your eligibility - usually based on your income, existing home ownership status, and your financial situation.

Once eligible for shared ownership, you might hear the term “staircasing,” which refers to the process of buying additional shares in your home over time.

New build vs resale through shared ownership

New build:

• Buying process: Typically involves reserving a property off-plan, securing a shared ownership mortgage, and then completing the sale when the build is finished.
• Style: New-build properties will often come with modern fittings and a warranty on them.
• Community: Usually part of a new development.
• Costs: A premium price for its new condition and potentially higher initial service/ground rent charges.

Resale:

• Buying process: Negotiation with the current property owner or housing association, like purchasing a traditional home.
• Style: Often older but could come with unique characteristics.
• Community: An established, existing neighbourhood.
• Costs: Generally, a lower price overall than a new build, but could require more maintenance.

Shared ownership in 10 steps

• 1. Check eligibility: Ensure you meet the criteria for shared ownership.
• 2. Find a property: Choose between new build or resale properties.
• 3. Reserve the property: Pay a reservation fee to hold your chosen property.
• 4. Apply for a mortgage: Secure a mortgage for your share of the property.
• 5. Instruct a solicitor: Choose a solicitor experienced in shared ownership.
• 6. Valuation and survey: Get the property valued and surveyed.
• 7. Draft contracts: Your solicitor will draft and review contracts.
• 8. Exchange contracts: Legally commit to buying the property.
• 9. Completion: Pay the remaining balance and complete the purchase.
• 10. Move-in: Collect the keys and move into your new home.

How long does shared ownership take to complete?

The timeline for shared ownership can vary, but here’s a rough guide for each stage:

Application: 1-2 weeks to determine eligibility.

Mortgage approval: 2-4 weeks depending on lender efficiency.

Finding a property: Variable; could take weeks to months based on availability and your preferences.

Exchanging contracts: 4-6 weeks after your solicitor begins drafting.

Completion and moving in: Typically, 1-2 weeks after exchanging contracts.

From start to finish, expect the process to take around 3-6 months, but this can be shorter or longer depending on individual circumstances.

Shared ownership conveyancing

Memorandum of sale

Once your offer is accepted, the housing provider issues a memorandum of sale. This document outlines the terms of the sale and includes details like the agreed price and the names of both parties.

Draft and exchange of contracts

Your solicitor will draft the initial contract and send it to the seller’s solicitor. They will review and negotiate terms until both parties are satisfied. Once the contract is agreed upon, it’s time to exchange contracts.

At this point in the property transaction, the sale becomes legally binding, and you’ll need to pay a deposit (usually 5-10%).

Completion date

After contracts are exchanged, a completion date is set. This is when the remaining funds are transferred, and you legally become the owner of your new home. Your solicitor will coordinate with your mortgage broker to ensure funds are in place.

Mortgage lender

Your solicitor liaises with your mortgage lender to confirm that the mortgage is ready to be released upon completion. They ensure all conditions set by the lender are met.

Key collection

Finally, on the completion date, you’ll receive the keys to your new home. Your solicitor will handle the final paperwork, making sure everything is registered correctly with the Land Registry.