When you hear shared equity, a housing scheme where you buy a portion of a property and pay rent on the rest. Also known as shared ownership, it’s designed to help people who can’t afford a full mortgage get onto the property ladder. It’s not a loan, not a gift, and not a rental—you’re part owner, but not fully. The government or a housing association owns the rest, and you pay rent on their share. This setup cuts your upfront costs and monthly payments, but it also means you don’t own everything outright.
Many people confuse shared ownership, a broader term that includes shared equity as one of its models. Also known as part-buy, part-rent, it’s the structure most first-time buyers in the UK use to break into the market. But shared equity is just one way to do it. The key difference? In shared equity, you can usually buy more of your home over time—called staircasing—until you own 100%. That’s where equity share, the percentage of the property you legally own at any point. Also known as ownership stake, it grows as you buy more. The more equity you hold, the less rent you pay. But there are limits. Most schemes cap staircasing at 100%, and you’ll need to pay valuation fees each time you buy more. And if you ever sell, you don’t keep all the profit—you split it based on your current equity share.
It’s not magic. There are trade-offs. You’re stuck with leasehold rules, which can mean high service charges and restrictions on renovations. You can’t just rent out your place without permission. And if the property value drops, you still owe your share. But for many, it’s the only realistic path to owning a home in today’s market. If you’re earning under £80,000 a year (or £90,000 in London), have a decent credit score, and can cover a small deposit, shared equity might be your best shot.
Below, you’ll find real breakdowns of how shared equity works, what it costs, where it falls short, and how to avoid the common traps. Whether you’re wondering if you can afford to staircase, what happens if you need to move, or why some people regret their deal—these posts have the answers.
30 Oct
No, shared ownership shareholders don't get paid monthly. You pay rent and mortgage, not receive dividends. This explains how shared ownership really works-and why it's not a source of passive income.
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