Shared ownership is an affordable way to get onto the property ladder. It allows you to buy a share in a property and pay rent on the remaining share. Greenhithe in Kent has several new build developments with shared ownership homes available (see Crossways Quarter).
This guide explores the benefits of shared ownership in Greenhithe and how the scheme works.
Overview of Shared Ownership
Shared ownership gives the benefits of homeownership alongside the affordability of renting. The basics:
- You purchase a 25-75% share in the property
- A housing association owns the remaining share
- You pay a subsidised rent on the share you don’t own
- Over time, you can buy bigger shares until you own 100%
Eligibility is based on local house prices and your household income. Shared ownership helps those unable to buy a home outright get their foot on the ladder.
Why Buy Shared Ownership in Greenhithe?
Greenhithe is an ideal location for shared ownership properties. Here are the key benefits:
Brand New Homes
Most shared ownership homes in Greenhithe are new build developments with modern designs and amenities. You get to be the first resident.
High Demand Location
South East London along the Thames is very desirable. Greenhithe offers quality housing outside the expensive central London area.
Excellent Transport Links
Greenhithe station connects to London Victoria and Charing Cross in under 40 minutes. The M25 and M20 motorways are minutes away.
Nature and Leisure
Greenhithe sits along the Thames riverside overlooking the Kent Downs Area of Outstanding Natural Beauty. Plenty of walking routes, parks, pubs, and leisure facilities are on hand.
Strong Investment Potential
Property values in Greenhithe are rising steeply, making shared ownership re-sales appealing. The area is being rapidly regenerated.
Affordable for first-time buyers
With lower deposit requirements, shared ownership helps first time buyers in an expensive region get their foot on the ladder.
Greenhithe ticks all the boxes in terms of location, homes and investment potential. Shared ownership provides an affordable route to homeownership.
Who Is Eligible for Shared Ownership?
Shared ownership eligibility is based on your household income and local property prices. The basic requirements are:
- Income of under £80,000– For properties outside London, below £90,000 within
- Savings under £16,000– For studio flats, or £24,000 for larger homes
- Unable to afford full ownership– You are priced out of buying a home outright
- Need a permanent home– Shared ownership is not for buy-to-let investors
You also normally need to be a first-time buyer unable to purchase on the open market. Priority is given to existing housing association tenants too.
Use the eligibility calculator on sites like Share To Buy and Help To Buy to see if you qualify. Regional differences apply so check locally.
How Shared Ownership Works
Shared ownership gives you part buy, part rent flexibility. Here is an overview of how the model works.
- Choose Your Property
Pick a newly built home from a shared ownership development that suits your needs and budget.
- Agree Your Share
Typically between 25-75% to keep initial costs affordable. You must fund your deposit and mortgage on the share purchase.
- Fund Your Share
In addition to the mortgage, you pay for legal fees, valuation, and stamp duty (if applicable).
- Pay Your Rent
A subsidised rent is charged on the share still owned by the housing association. This is 1-3% of the total property value.
- Own More Over Time
You can staircase to buy extra shares as your financial situation improves, paying lower rent until you own 100%.
- Re-Sell In Future
When moving, you sell your share. Improvements made will help your share value increase over time too.
Shared ownership lets you realise the dream of homeownership now whilst steadily building your stake in an affordable way.
Pros and Cons of Shared Ownership
Shared ownership offers benefits but also some drawbacks to factor in. Consider these key pros and cons before buying.
- Lower deposit to get on ladder
- Reduced mortgage borrowing
- Lock in housing costs
- Modern new build home
- Invest your money elsewhere
- Low risk entry to ownership
- Staircase to full ownership
- Mortgage interest rates can be higher
- Limited housing options
- Rent can increase annually
- Shared ownership resales take longer
- Full repairs your responsibility
- Leasehold terms may be restrictive
Shared ownership works best for those comfortable with the model who plan to staircase to full ownership within 5-10 years. Being prepared for both benefits and limitations ensures it will suit your situation.
Finding Your Perfect Shared Ownership Home
Choosing your first shared ownership property is exciting! Here are 7 top tips for finding the ideal home for you:
- Make a Wish List
Define what you need – location, number of bedrooms, parking etc. Plus desirable features like a balcony, ensuite or garden.
- Choose Area First
Decide which town or neighbourhood suits you best regarding commute, amenities, community etc. Then view suitable homes there.
- View Multiple Properties
To make the right decision, view a range of shared ownership homes in your area to assess them fully. Consider practicalities and your emotional response.
- Buy With Room to Grow
Consider an extra bedroom if you hope to start a family soon. It provides room to expand.
- Check Service Charges
Factor in ongoing service charges for maintenance costs, management fees etc. Charges vary greatly so do your research.
- Have Surveys Done
If possible, get an independent survey done before exchanging contracts in addition to the mortgage valuation. This identifies any issues needing addressing.
- See Last Improvements
With new builds, visit when the property is fully finished before completion to ensure you are happy with the final product.
Doing your research and viewing multiple properties ensures your first shared ownership home ticks all of your key requirements.
Affording Your Share
Deposit, mortgage, legal and moving costs quickly add up when buying. Here are some tips for funding your share:
For shared ownership, deposits are typically 10% of your share value. With smaller shares, this makes the deposit affordable to save on median incomes.
Use Mortgage Guarantors
Family members can be guarantors to boost mortgage affordability if your share borrowing is close to 4.5x income.
Apply for equity loans and grants
Schemes like Help to Buy Equity Loans can fund up to 20% of the purchase price to shrink your deposit and mortgage required.
Check for local authority grants
Some councils offer grants or subsidised funding for those struggling to cover purchase costs. These are given on a needs basis.
Save on moving fees
Opt for affordable removals options using man and van services or moving yourself. Save on solicitors using online conveyancing services. Reduce stamp duty with a lower share.
Setting a savings target, securing the right mortgage deal, and utilising available affordability help maximises your chances of funding your ideal shared ownership home.
Tips for Living in Shared Ownership
These tips help you settle happily into shared ownership and make savvy financial decisions:
- Overpay your rent annually by any amount – this slowly increases your share
- Upgrade appliances over time to make it feel more your own
- Budget for increasing service charges each year
- Maintain the property well so that it holds value
- Keep finances healthy so you can staircase when ready
- Be neighbourly – you may share communal areas with other owners
- Read the lease terms fully – restrictions apply on some improvements
- Consider taking in a lodger to help cover costs
- Save extra income to buy added shares and own 100% sooner
Living frugally, maintaining your home and overpaying rent gives you every chance of thriving in shared ownership.
Reselling Your Shared Ownership Property
When the time comes to sell, here is how resales work:
- Your housing association has the first right to purchase your share
- An independent RICS valuation will determine your share price
- The property is marketed at your valuation price
- Viewings are conducted just like a normal property sale
- Once sold, your buyer funds their deposit and mortgage
- You repay your mortgage and receive the remainder equity
Improvements, local price growth and overpaying rent usually mean your share has increased in value. This results in a tidy profit when selling your share.
Pros of Shared Ownership Resales:
- Capitalise on value growth in your area
- Benefit from upgrades made
- No chain delays as the association owns remaining share
- Resale terms outlined in your lease for certainty
- Housing associations motivated for quick sales
Following the resale process, you can use your equity to put towards your next step on the property ladder.
Should You Buy Shared Ownership in Greenhithe?
For many first time buyers, shared ownership is the perfect solution to get into homeownership. With brand new homes in high demand areas like Greenhithe, the scheme really comes into its own.
Shared ownership helps you buy now while expanding your share later as income rises. Lower deposits, smaller mortgages, and subsidised rents provide an affordable step onto the ladder.
Making smart financial decisions and maintaining your home leads to a profitable sale to fund the jump to full ownership. In a rising property market like Greenhithe, shared ownership can be a savvy investment while enjoying the perks of homeownership.
Just be prepared for the limitations alongside the benefits. Used wisely, shared ownership offers an exciting opportunity to buy with flexibility.