This housing scheme allowed April to move back to the village where she was brought up – enabling her to be near her friends and family
When mum-of-one April Mathieson started exploring the idea of getting on the property ladder, she knew she wanted to be near friends and family.
But the 33-year-old, who works as a teacher, says her options were limited with what she could afford if she wanted to buy in her desired location.
Her sister had used the shared ownership scheme, meaning she was familiar with the concept – so she decided to use this herself to purchase a 50% share of a property in Preston, Lancashire.
Shared ownership is where you buy a portion of a property and pay rent on the rest. The share you can buy is usually between 25% and 75% but can be as low as 10%.
You can normally then staircase – which is where you buy additional shares in your shared ownership home – until you own 100%.
April purchased her first shared ownership property in 2020 with a 50% share, before selling it just two years later and then staircasing her current home, a three-bed semi-detached, all the way to 100%.
April, who has a six-year-old son, said: “I bought my first shared ownership home literally the month before lockdown. I was very, very lucky – and I literally had my son the weekend that lockdown was announced.
“I knew that my salary was gonna go up quite a bit over the next few years, compared to when I’d moved in. I did save a little bit, and I just fast-tracked it as much as I could.
“I didn’t do much. I didn’t go out a lot. I didn’t do a lot of things. I did sacrifice quite a bit, but obviously it’s quite a big jump to have gone from 50% to 100%. I think the knock on of Covid and things like that, I was still staying quite a lot.”
April always had staircasing in mind when she started with shared ownership, as she was expecting her salary to rise over the next few years.
When you staircase, how much you have to pay is based on an independent market valuation at the time you buy the share, meaning you pay more if property values rise.
April said: “The best factor that helped me was my salary going up. The extra deposit that I paid was £7,000 – so, this was something that was achievable in 18 months for me.
“If you’ve got a longer term view of things and you know you will stay somewhere long term, then I think that with shared ownership, you can just add to it. You know you can staircase in bits.
“My sister had done shared ownership before, so I did have a little bit more reassurance or confidence, because I knew somebody who had done it.”
A survey by West Brom Building Society found 79% of people who used shared ownership say it helped them get onto the property ladder. A further 54% say they have lower monthly costs than renting.
However, there are things to consider. You pay rent to the housing association on the share you don’t own and this usually increases annually. There are also service charge fees.
You are also fully responsible for the maintenance and repairs of the property – even though you only own a fraction of it.
If you do want to sell, the housing association usually has a “nomination period” of typically eight weeks where they have the exclusive right to find a buyer for your share. If they do not find a buyer, then you are free to put it on the open market.
But regardless, Kelly McCabe, Managing Director at The Mortgage People, said she is increasingly seeing customers using the scheme following major life changes such as divorce, separation, downsizing or changes in household income.
She said: “Shared ownership continues to play an important role in helping people access the housing market at a time when affordability remains one of the biggest barriers to homeownership.
“While it is often associated with first-time buyers, the reality is that shared ownership supports a much broader range of people and circumstances.
“Like any housing scheme, it is important that buyers fully understand the costs involved, including rent and service charges alongside the mortgage, and take advice to ensure it suits their circumstances and long-term plans.
“For many people, shared ownership is not simply a stepping stone, but a sustainable form of homeownership that provides stability, security and an opportunity to continue owning a home in a market that has become increasingly difficult to access outright.”
For April, shared ownership allowed her to move back to the village where she was brought up – enabling her to be near her friends and family.
She said: “If I didn’t do shared ownership, I wouldn’t have been able to live in the area that I wanted to. That was the main thing, being able to be close to friends, family, work. If I bought a house on the open market, the level of money that I would have needed to have made it habitable, was unrealistic.
“It just changed my life really. My son goes to school, but if I can’t pick him up, now all of my sisters can be there. Being in the place that I’ve always lived is fantastic. My options would have just been extremely limited.
“The staircasing process with West Brom was just so easy. It was just an initial telephone inquiry… I got the appointment within a couple of weeks. It was all done via telephone calls.”
To qualify for shared ownership, you need to have had a household income of £80,000 or less, or £90,000 or less in Greater London.
These thresholds apply to the combined gross income of all people who will be named on the mortgage.
