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Selling a Shared Ownership Property: Essential Steps & Considerations

Published by Susan Basnet
Published Date: April 19, 2024

Selling a shared ownership property demands a distinctive set of considerations and procedures. The process can vary depending on whether you own 100% of the property or a specific percentage.

In this article, we will guide you through the intricacies of selling a shared ownership home, providing insights into the essential steps involved in the process. Please continue reading to gain a comprehensive understanding of what it takes to sell a shared-ownership property.

How Shared Ownership Works

Shared ownership is a widely embraced scheme, popular among individuals who find it challenging to cover a home's entire deposit and mortgage payments.

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% based on your financial capacity.
  • Rent Payments - You make regular rent payments to the landlord for the portion of the property they still own.
  • Additional Costs - In addition to the mortgage and rent, you contribute towards monthly ground rent and service charges. These extra payments contribute to maintaining communal areas and shared facilities within the property.

Selling a Shared Ownership Property

Selling a shared ownership property is a flexible process, but the methods can vary based on your ownership percentage. If you own 100% of the property, you can sell it on the open market through an estate agent or other channels.

Selling a shared ownership property

However, there is one crucial thing to consider - homes with a 'Designated Protected Area – Mandatory Buyback' lease cannot be sold on the open market, and the nomination period procedure applies. To understand what type of lease your home has, refer to the 'Key Information Document' for the home.

Selling a property where you don't have 100% ownership is more complex. The general procedure involves informing your landlord of your intention to sell, and then the landlord is responsible for finding a buyer for your share.

Nomination Period Rule

Once the landlord receives notice of your intent to sell, they enter a 'nomination period,' which lasts for 4, 8, or 12 weeks, depending on the lease agreement. During this period, the landlord looks to find a buyer for your share. If the landlord fails to find anyone within the nomination period, you can sell your share on the open market.

In some exceptional cases, the landlord might offer to purchase your share if they have the necessary funds.

Suppose a buyer is found during the nomination period. In that case, your sales proceeds will be based on the current market value of your share, determined by a surveyor registered with the Royal Institution of Chartered Surveyors (RICS).

Exceptions to the Nomination Period

Certain situations, like those listed below, create exemptions to the nomination period:

  • The death of either you or another person on the lease.
  • A court order instructing you to transfer the ownership of property.

Valuation Requirement 

As previously emphasised, obtaining a property valuation from an RICS-registered surveyor is essential, as it represents the selling price of your share in the property. Whether arranged by you or the landlord, you are responsible for covering the costs associated with the valuation.

Potential Selling Costs

When selling a shared ownership property, the landlord may impose fees, typically outlined in the 'Key information document' or the lease. If you have difficulty identifying these costs, ask your landlord for clarification.

In addition to the landlord's fees, you are also responsible for covering legal expenses associated with the sale of your home.

CGT on Selling a Shared Ownership Property

Another consideration that comes into play when selling a shared ownership property, or any asset for that matter, is the Capital Gains Tax (CGT). CGT must be paid on the disposal of asset that has appreciated in value. The rules that apply to properties under shared ownership scheme are similar to the typical CGT rules, including the Private Residential Relief (PRR) and the lettings relief – the two reliefs that substantially reduce an individual’s CGT liability.

Example - PRR, 

Mr. A purchased 50% shares in a home for Β£300,000 under the shared ownership scheme in 2010. He lived in the property for the whole time he owned the property and sold his shares in 2024 for Β£500,000.

Although the value of the property has appreciated by Β£200,000, there will be zero CGT liability as the Private residential Relief (PRR) is available in full because he lived in the property as his main residence.

Example - Letting Relief, 

Had Mr. A rented a part of his home, like a large bedroom constituting 10% of the total space, and later sold his property with a chargeable gain of Β£300,000, two tax reliefs come into play. In this scenario, he would receive Private Residence Relief for Β£270,000 (90% of the total gain) because 10% of your home was let out.

Additionally, he would be entitled to Letting Relief for the remaining gain of Β£30,000, which corresponds to the portion of the rented property. The combined effect of these reliefs means he would not have to pay any tax on the gain from the sale of your property.

It should be noted that the Private Residential Relief maybe restricted if the property isn’t occupied for the whole time. For a detailed understanding of these conditions, explore our guides to letting relief and PRR.


To sum up, selling a property obtained through the shared ownership scheme is contingent on various factors, including the type of lease and the ownership percentage of the property.

Additional costs may also be incurred during the sale. Being well-informed about such intricacies is critical to facilitating a seamless transaction when selling a shared ownership property.

Susan Basnet
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