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Renting A Shared Ownership Property

Published by Susan Basnet
Posted Date: May 28, 2024 , Modified Date: May 30, 2024

Amidst the growing interest in shared ownership homes, many individuals are considering the possibility of renting them out.

So, what are the renting options available for owners? Let's delve into this topic, exploring the journey from acquisition to potential rental opportunities.

How Shared Ownership Works

Shared ownership is a widely embraced scheme, particularly among individuals who may find it challenging to cover the entire deposit and mortgage payments for a home. Shared ownership homes are offered by housing associations, local councils, and other organisations, who are called ‘providers’ or landlords.

The basic premise of the shared ownership scheme involves the following steps:

  • Acquire a Share - You purchase a share of the home's full market value. This share can range from 10% to 75%, providing flexibility based on your financial capacity.
  • Rent Payments - You make regular rent payments to the landlord for the portion of the property under the ownership of the landlord.
  • Additional Costs - In addition to the mortgage and rent, you contribute towards monthly ground rent and service charges. These additional payments contribute to the maintenance of communal areas and shared facilities within the property.

It’s crucial to note that all shared ownership homes, whether houses or flats, are leasehold properties.

Benefits of Shared Ownership Property

As noted earlier, shared ownership schemes are increasingly gaining popularity among home buyers for several compelling reasons, including:

Benefits of Shared Ownership Property
  • Low Initial Investment - Within the shared ownership scheme, your upfront investment is significantly reduced as you're only purchasing a portion of the property. Consequently, the deposit required is calculated as a percentage of the mortgage, i.e., the cost of your share of the home.
  • Option for Share Expansion (Staircasing) - A key advantage of shared ownership is the opportunity to increase your ownership stake over time through a process known as staircasing. Typically, you can purchase additional shares, often in increments of 10%, subject to any restrictions imposed by the landlord. It is essential to review the 'key information document' provided by the landlord to understand any limitations on further share acquisition.
  • Enhanced Stability - Homeownership under the shared ownership scheme offers greater stability compared to renting. You won't face the uncertainty of having to relocate at the discretion of a landlord.
  • Ability to Sell - Selling your share in a shared ownership property is generally straightforward, although this can vary depending on factors such as the terms of the lease and your percentage of ownership. It's important to note that you'll be responsible for any associated legal fees incurred during the resale process.

Eligibility Criteria for Shared Ownership Home

To qualify for the purchase of a shared ownership home, individuals must meet the following conditions:

  • Household income should not exceed £80,000 per year (£90,000 per year in London). For the purpose of shared ownership scheme, household income generally means the cumulative income of a family buying the shared ownership home
  • Inability to afford the full deposit and mortgage payments for a home
Eligibility Criteria for renting shared ownership property

Additionally, one of the following conditions must apply:

  • You are a first-time buyer
  • You used to own a home but cannot afford to purchase one now
  • You are creating a new household, for example, after a relationship breakdown
  • You are already part of a shared ownership arrangement but wish to move to a new property. You may need to sell your shares in the previous shared home

Furthermore, you may have to verify that you live, work, or have a connection to the area where you want to buy the home.

Your eligibility to buy a home through shared ownership can be assessed through HMRC’s website.

Eligibility Criteria: Special Rules

Special rules apply under specific scenarios, including:

You Own a Home

If you own a home and are planning to buy a shared ownership home, the sale of your old home must have been completed on or before the date you complete buying your shared ownership home. As a part of this, you must have formally accepted an offer for the sale of your current home, i.e. 'sold subject to contract (STC)’. Additionally, a written confirmation of the sale, i.e., a memorandum of sale, must be agreed upon.

Older People

If you’re aged 55 or over at the time of buying the home, the maximum percentage of shares you can buy is 75% through the Older Persons Shared Ownership (OPSO) scheme. Rent must be paid on the rest of the property.

Disabled People

If other schemes do not meet your needs, e.g. you need a ground-floor home; you can apply for a scheme called home ownership for people with a long-term disability (HOLD).

Renting a Shared Ownership Property

The ability to lease a shared ownership property is contingent on various factors, including your ownership percentage, your intention to reside in the property, and the presence of any restrictions outlined in the 'key information document.' Generally, your situation should match the following situations:

Renting a Shared Ownership Property

Renting While Living There

If you are living in a shared ownership home, there are no restrictions on renting out a portion of the property while you reside there. Therefore, you can bring in a lodger to stay with you without requiring permission from your landlord. However, it is advisable to talk to your landlord regarding your plans to rent – especially if the ‘key information document’ for the home contains such an agreement.

Subletting Entire Home

If you plan to sublet the entire home, certain conditions apply.

Either you must own a 100% share in the home, or you need explicit permission from the landlord.

Landlords typically do not grant permission for subletting, except in exceptional circumstances, like members of the armed forces serving away for a fixed period.

Check the Key Information Document

Review the 'key information document' for the home, as it often contains rules and conditions regarding subletting the property.

If you're considering selling your shared ownership home instead of renting it and want to understand the procedures and tax implications, read our comprehensive article "Selling a Shared Ownership Property: Essential Steps & Considerations" for guidance.


In conclusion, there are various renting options available for properties acquired through shared ownership schemes, and these options can vary depending on factors such as the lease agreement and your ownership percentage.

It's crucial to fully understand the process of renting out your home. If you're uncertain about any aspects of your agreement with the landlord, seeking professional advice is highly recommended.

Need Expert Advice on Renting a Shared Ownership Property ?

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Susan Basnet
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