Shared ownership calculator
Shared ownership splits the cost three ways: a mortgage on the share you buy, rent on the share you do not, and a service charge. This brings them together into one monthly figure for any share size.
How the monthly cost splits
| Part | Per month |
|---|---|
| Mortgage on your share | £362 |
| Rent on the landlord's share | £516 |
| Service charge | £100 |
| Total | £978 |
How shared ownership is costed
You buy a share of the home, commonly between 25% and 75%, with a mortgage and deposit on that share. On the rest, which the housing association keeps, you pay rent set at an annual percentage of the unowned value, usually around 2.75%. A service charge sits on top because the property is leasehold. The three parts pull in different directions: buy a bigger share and the mortgage rises while the rent falls, so the cheapest monthly total is not always the smallest share.
Worked example
Take a £300,000 home and a 25% share worth £75,000. With a 10% deposit the mortgage is £67,500, costing £362 a month at 5.0% over 30 years. Rent on the £225,000 you do not own adds £516, and the service charge adds £100. The total is £978 a month, or £11,736 a year.
Common questions
How does shared ownership cost work?
You pay a mortgage on the share you buy and rent on the share the landlord keeps, plus a service charge. Buying a 25% share of a £300,000 home in this example costs about £978 a month: £362 mortgage, £516 rent and £100 service charge.
How is the rent on a shared ownership home worked out?
The rent is charged on the share you do not own, usually at an annual rate of around 2.75% of that unowned value, set when you buy. So the smaller the share you buy, the more rent you pay, because the landlord owns more of the property. The rate can rise each year under the terms of the lease.
Is a bigger share always cheaper each month?
Not necessarily. A bigger share means a larger mortgage but less rent, and mortgage rates and rent rates differ, so the monthly total can move either way. Buying more of the home, known as staircasing, also needs a bigger deposit and valuation, so it is worth modelling the monthly cost at a few different share sizes before deciding.
Do I pay stamp duty on shared ownership?
You can, but there are choices. You either pay stamp duty on the full market value up front, or pay in stages as you buy bigger shares. Many first-time buyers pay nothing initially because the share value is below the threshold. Check the current rules, as the stamp duty treatment of shared ownership is specific and can change.
What is staircasing?
Staircasing is buying additional shares in your home over time, up to 100% in most cases. Each purchase increases your mortgage and reduces the rent you pay, and once you own the whole property the rent stops. There can be valuation and legal fees each time you staircase, so it is not free to do.
Does the service charge still apply?
Yes. Shared ownership homes are usually leasehold, so a service charge applies to the whole property regardless of the share you own. That is why it is a separate line here rather than being scaled to your share. It can rise year to year like any leasehold service charge.