FAQs

Updated: 12 May 2011

What is shared ownership? (337 KB)
Note: Housing Options is now known as FIRST STEPS

1. What is shared ownership?

Shared ownership is known by several different names, including:

• HomeBuy
• Part buy/part rent
• New Build HomeBuy
• Resales.

Shared ownership is a government scheme for first time buyers who cannot afford to buy a home on the open market. It allows you to buy a share of a home with a mortgage, and pay a lower rent on the rest.

The minimum share you can buy depends on the property that you are buying. It can be as low as 25% (the largest first share is usually 75%).

2. What type of homes do we provide?

Gateway builds new one, two and three bedroom homes in east London.

All our new homes are of a high standard and include quality kitchens with white goods (such as a fridge and a cooker) and floorings.

We often have re-sales available too. These are existing shared ownership properties where the owners have decided to move on.

3. Who is eligible for shared ownership?

Shared ownership is available to most first time buyers who meet a basic elibility criteria.

To be eligible for shared ownership you need to apply to FIRST STEPS, a government-appointed agent who assess all applications.

At the moment, to qualify, your maximum household income needs to be less than £60,000 a year. Your minimum income depends on the property, the price of the share you want to buy and your savings (for a deposit).

4. What are the benefits of shared ownership?

• It has all the benefits of owning your own home straightaway, at a price you can afford.
• People on lower incomes are not excluded from home ownership.
• There is less financial risk than buying outright.
• How much you can buy to start with is flexible.
• Monthly costs are cheaper than renting privately.
• You have the security of knowing that you can eventually own 100% of your home.

5. How much will it all cost?

Buying your first home is a big financial commitment. We can break down the costs into two types.

'One off' purchasing costs - For this you will need savings. The amount will depend on the property you are buying, your solicitors and your mortgage lender. We estimate you will need between £2,000 and £4,500 to cover the cost of buying a home. This does not include your deposit.

One off costs include:

• solicitor's fees
• mortgage valuation costs
• mortgage arrangement fees
• fittings and furniture
• a mortgage deposits and
• you will also need money to pay for the costs of moving your home.

Running costs - You will be responsible for the everyday costs of home ownership, including:

* your mortgage;
* rent payments to Gateway;
* Council tax;
* repairs, insurance and service charges;
* heating and lighting, water, phone and other charges such as broadband or TV subscriptions; and
* Mortgage protection insurance.

6. Can I afford all this?

Talk to us. We will look carefully at your income and let you know if we think you can afford it.

7. Can I buy more of my home later?

• Yes*. After 12 months (or three months for a resale) you are can buy up to 100% of your home. The price you pay is based on the market value at the time. However, you can only staircase up to three times.

For example, if you own 50% now, in 2 years time you may buy another 20%, followed in say 5 years by a further 15% and finally the last 15% at some time later. (The time scales and percentages are flexible and up to you).

8. What happens if I want to sell in the future?

We will help you to sell your home if you are still a shared owner. The lease allows us to nominate someone who wants to buy a shared ownership property.

If we can't find a buyer within the nomination period (usually four or eight weeks, depending on your lease) you can then sell through an estate agent or privately.

9. Can I buy a bigger home in the future?

Your circumstances may change in the future and you may need a bigger home.

If we have a a suitable property available, we will try to help you move by finding you someone to buy your existing home and co-ordinating a simultaneous purchase of a new Gateway property.

10. Who is responsible for repairs, decorations and maintenance?

• You are*. When you buy through shared ownership you have a full repairing and insuring lease, which is usually 99 or 125 years long.

If you buy a flat, your repsonsibilities include:

• internal repairs;
• decoration to the inside; and
• arranging household contents insurance.

Our responsibilities include:

• the maintenance of the outside of the block and shared areas;
• redecoration of the outside of the block and shared areas; and
• buildings insurance.

You will share the cost of this with the other flats in the block through the service charge.

If you buy a house, all repairs are your responsibility, but we will arrange the buildings insurance and charge you the premium once a year.

11. Can I sub-let my home?

• No*. The lease does not allow it whilst you are still a shared owner. However, in exceptional circumstances, such as a temporary job relocation, we will consider your request.

12. Can I make improvements or alterations?

• Yes*. If you want to carry out improvements you must get our written agreement first. We do not allow works that may affect the structure or that may decrease the value of the property.

13. Do I need a solicitor?

• Yes*. It is important to get legal advice when buying a home. We can provide you with a list of solicitors who are experienced in shared ownership leases.

14. How do I arrange a mortgage?

You are free to use any financial advisor you choose. We have a list of independent fianncial advisors who specialise in finding the best shared ownership mortgage deals.

Printable version