1. What is Shared Ownership Payment?

Shared ownership payment consists of two parts: mortgage payment on the share you own and rent payment on the remaining share owned by the housing association. This scheme helps people get on the property ladder by purchasing a portion of a property.

2. How Does the Calculator Work?

The calculator uses the following formula:

Where:

• Mortgage on Share — Calculated using standard mortgage formula based on your share value
• Rent on Remaining — Calculated as a percentage of the remaining property value

Explanation: The mortgage portion is calculated using the standard amortization formula, while the rent is a simple percentage of the remaining property value.

3. Importance of Shared Ownership Calculation

Details: Understanding your total monthly payment helps in budgeting and determining if shared ownership is affordable for you. It's crucial to consider both mortgage and rent components.

4. Using the Calculator

Tips: Enter the full property value, the percentage share you're purchasing, mortgage details (interest rate and term), and the rent percentage on the remaining share.

5. Frequently Asked Questions (FAQ)

Q1: What is typical share percentage in shared ownership?
A: Typically between 25% to 75% of the property value, though this can vary by scheme.

Q2: Can I increase my share over time?
A: Yes, through a process called "staircasing" where you buy additional shares in the property.

Q3: How is the rent percentage determined?
A: The housing association sets this, typically between 2.75% to 3% of their share's value annually.

Q4: Are there other costs besides mortgage and rent?
A: Yes, you'll also need to budget for service charges, buildings insurance, and maintenance costs.

Q5: Can I sell my shared ownership property?
A: Yes, but usually the housing association has first refusal to buy it back or find another shared ownership buyer.