Shared Ownership, the First Homes scheme and other government backed initiatives exist to help people buy when a full market purchase feels out of reach. We’ll talk you through the options honestly and help you work out which route actually suits your situation.
Moving to a new home is exciting, but working out the mortgage side of things can feel complicated, even if you’ve bought before. At Saho Financial Services, we cover everything from traditional mortgages to porting and fixed or variable rate options. For an independent overview of the buying process, the MoneyHelper guide to buying a home is a helpful starting point. You can also use our stamp duty calculator to see how much you’ll need to budget for on top of your deposit.
We regularly advise buyers using these schemes and know which lenders offer the most competitive terms for Shared Ownership and First Homes applications. If you’re not sure whether a scheme is right for you, it’s worth having a conversation before you commit to a route.
With Shared Ownership, you buy a share of a property, typically between 10 and 75 percent of its value, and pay a subsidised rent to a housing association on the portion you don’t own. You take out a mortgage on your share only, which means a smaller deposit and smaller monthly mortgage payment than a full market purchase. Over time, you can buy additional shares in the property, a process known as staircasing, until you own it outright. Full details are set out on the Own Your Home Shared Ownership page.
A buyer in London earning £38,000 wants to purchase a flat valued at £320,000 but can only save a 5 percent deposit on their full income. Under Shared Ownership, they purchase a 40 percent share for £128,000, require a mortgage of around £121,600 after their deposit, and pay a monthly rent on the remaining 60 percent share. Their combined monthly outgoing is lower than a full market mortgage would be, and they have a clear path to buying further shares as their income grows.
Eligibility rules can vary between individual housing associations and schemes, so it’s worth checking the specific criteria for any property you’re interested in.
The First Homes scheme offers eligible first time buyers a discount of at least 30 percent, up to 50 percent in some areas, on new build properties in England. The discount is retained in perpetuity, meaning future buyers of the same property must also be eligible first time buyers and purchase at the discounted price. Full eligibility criteria are on the Gov.uk First Homes guidance page.
A newly qualified teacher earning £32,000 in a high cost area wants to buy their first property. A new build flat is listed at £280,000 on the open market, but qualifies under First Homes with a 30 percent discount, bringing the purchase price to £196,000. The deposit and mortgage required are significantly lower, making the purchase achievable on a single income.
Whether you’re buying through Shared Ownership or First Homes, a Mortgage in Principle is a useful first step. It shows housing associations and developers that you have mortgage backing in place. Not all lenders offer mortgages on scheme properties, so it’s important to work with an adviser who knows the market. Our mortgage calculator can give you a rough idea of borrowing power before we speak.
New to the market entirely? Our first time buyer mortgages page covers the full process from deposit to completion.
Thinking about buying a property to let out? See our buy to let mortgages page.
If you have a smaller deposit and a less than perfect credit record, our bad credit mortgages page explains what’s available.
Use our stamp duty calculator to check whether your scheme purchase qualifies for first time buyer relief.
Ready to speak to someone? Visit our contact page and an adviser will get back to you shortly.
Yes, many lenders offer Shared Ownership mortgages with a deposit of 5 to 10 percent of the share price, which is significantly less than a full market purchase would require.
The First Homes scheme currently applies in England only. Scotland, Wales and Northern Ireland have their own separate schemes and eligibility criteria.
Most Shared Ownership leases allow you to staircase to 100 percent ownership, though the terms vary between housing associations. Your solicitor should review this before you buy.
The discount is retained in the property permanently. When you sell, the same percentage discount must be applied to the open market value at that time, and the buyer must be a qualifying first time buyer.
Not all lenders offer Shared Ownership products. We work with a panel that does, and we’ll match you with the most suitable lender for your specific share size and property type.
