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  1. Blog
  2. Selling a shared ownership property - How it works
Help for first time sellers
08 October 2020

Selling a shared ownership property - How it works

Daniel Strieff
A young home owner in modern living room surfs the internet on laptop with cup of tea

Table of contents

  1. 1. What is shared ownership?
  2. 2. What do I need to buy a shared ownership property?
  3. 3. Are shared ownership properties leasehold?
  4. 4. Are shared ownership properties hard to sell?
  5. 5. How does selling a shared ownership property work?
  6. 6. What is staircasing?
  7. 7. Back to back staircasing
  8. 8. How to sell a shared ownership property
  9. 9. Selling a shared ownership property on the open market
  10. 10. Can you make a profit on shared ownership?
  11. 11. What fees do I need to pay when selling a shared ownership property?
  12. 12. I can’t sell a shared ownership property
  13. 13. FAQs

Updated 4th May 2022

Finding objective information about shared ownership properties can be difficult. Shared ownership is a fairly new form of home ownership in the UK, so most of the information out there is written either by those who hugely support the scheme, or those that don’t.

Below we attempt to cut through all the confusion. We look at how selling a shared ownership house works - how it’s different from your usual home sale, and what fees are involved.

What is shared ownership?

Officially called “Help to Buy: Shared Ownership”, shared ownership is a government-backed scheme intended to help buyers who can’t afford a full mortgage.

The scheme allows buyers to purchase a 'share' of between 25% and 75% of a property’s value and pay rent on the remaining share. Rent on shared ownership homes is generally lower than market rate, and are usually paid to the housing provider.

What do I need to buy a shared ownership property?

Because shared ownership is a type of affordable housing, in order to buy into a shared ownership property, you must meet certain criteria tied to income and financial resources. This is designed to make sure that shared ownership properties are available for people who cannot afford to pay full market value for their home. The two key criteria for being able to buy a shared property are:

  • Combined household income of £80,000 a year or less (£90,000 or less a year in London)
  • You’re either a first-time buyer, used to own property but can’t afford to buy one now, or are an existing shared owner looking to move.

Are shared ownership properties leasehold?

All shared ownership properties are leasehold rather than freehold. As the leasehold owner of a share, you'll have an agreement (or lease) with the freeholder - usually a housing association, developer, or housing provider - to use the property for a fixed amount of time. Your lease will contain a variety of obligations for both you and the freeholder. This includes things like who will maintain communal areas - like gardens and stairwells - and how long your lease will last for.

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Are shared ownership properties hard to sell?

Yes, shared ownership properties can be harder to sell than a standard home due to certain conditions which lead to less potential buyers. You can sell your Shared Ownership property like any other home - however, there are restrictions on the sale of your home if you haven’t staircased to 100% ownership. The idea is that these types of properties must remain available to people in need of affordable housing. This can make it a bit more difficult to sell a Shared Ownership home than a standard one. To find out the procedure for selling your Shared Ownership home, refer to your lease for full instructions - or read on for a basic overview.

How does selling a shared ownership property work?

1 - You must inform your housing provider

If you're looking to sell your home soon, you should begin by checking with your housing provider. Most housing associations will levy a charge to cover the cost of selling your shared ownership home - this is usually called a nomination fee. You should also be able to find the details of any fees you'll need to pay when you sell your home in your original lease.

2 - You are required to sell your full shares

When you're selling a shared ownership home, you're required to sell the entirety of your stake in a shared ownership property - not just a portion of your share. So, if you own 50%, then you must sell at least that 50% share to the new buyers. The housing association you lease from will then keep the remaining share.

However, you have the option to sell more than your current share (up to 100% ) of your home even if you currently only own a portion of it.

3 - You must pay off any outstanding debts

You will also need to pay off any outstanding debts on your home, such as any remaining mortgage or rent arrears, before you can put your shared ownership property up for sale.

4 - You will need to get a valuation from a RICS qualified surveyor

Next, your housing association will arrange for an independent RICS qualified chartered surveyor to determine the market value of your property. You will be billed the receipt of this valuation.

The RICS qualified valuation is a necessary step towards setting the asking price for your share. You must sell at this determined market value - neither more nor less.

Any improvements you’ve made to your home will also be included in the surveyor’s assessment of the property’s market value. While many improvements often do boost the value of your share, others do not. Do your homework to learn which ones will help you.

What eligibility criteria does the buyer need to meet?

Like when you bought your property, any buyers you find need to meet the requirements set out in the shared ownership scheme. For instance, the buyer’s combined household income can’t be more than £80,000/year (or £90,000 in London) and they must have sufficient financial resources to cover the deposit. They’re also often first-time buyers.

If you're unsure what criteria they need to fulfil to qualify for your shared ownership home, it's best to check in with your housing association.

What is staircasing?

If a buyer would like to purchase a larger share of their property later, they can do so through a process known as 'staircasing.' Staircasing allows buyers to gradually purchase larger shares of their shared ownership property, leading to lower rental fees on the remainder of the property. Buyers can staircase to 100% ownership.

Back to back staircasing

If you’re struggling to sell your home, you could consider back to back staircasing (or ‘simultaneous staircasing). This allows you to sell more than your current share (up to 100% ) of your home even if you currently only own a portion of it.

How does back to back staircasing work?

Your housing association usually has a limited period of time to find a buyer for your home before it goes on the 'open market' (for sale by an estate agent). If they don't find a buyer in the time allowed (typically eight weeks), you can sell the entire property through a process known as “simultaneous” or “back-to-back” staircasing.

Here’s how it works: On the same day your sale goes through, you increase your share of the property to 100%. The funds for the extra shares will be drawn from the money paid by the buyer, so there’s no need for you to borrow money. Additionally, making the sale this way allows you to accept offers of more - though not less - than the amount of your market valuation.

How to sell a shared ownership property

While these instructions might not apply to everyone (see the details of your lease), they should prove helpful should you decide to sell your shared ownership home. Here are 13 steps to follow in order to sell your shared ownership property:

  1. First and foremost, inform the housing association (HA) that you wish to sell your home.
  2. The HA will order a RICS red book valuation to determine your property’s market value. You, the seller, will pay for this.
  3. After the report is complete, the HA will send a copy to you, confirming the property's selling price.
  4. It’s now up to you to approve the valuation and instruct the Housing Association to start marketing your home.
  5. The HA will either begin marketing the property, or they will approve the property to go on the open market until an ideal buyer is found.
  6. Once a buyer is found, a mortgage broker will make a detailed assessment of their affordability to determine whether they are a right fit for the shared ownership scheme.
  7. Once the buyer is approved by the mortgage broker, your property will be reserved for them and the buying process can begin. The HA will send out a Memorandum of Sale (a confirmation of your reservation).
  8. Your conveyancer issues a contract of sale.
  9. The buyer’s conveyancer raises any enquiries.
  10. Your conveyancer responds to any enquiries with assistance from the housing association.
  11. Your buyer’s mortgage offer is issued (if required).
  12. Exchange of contracts within 28 days of the release of contracts.
  13. Sale is completed on the Completion Day.

How can I speed my shared ownership property sale up?

You can speed up the sale or your shared ownership property with housing associations. Every case is different, but most housing associations already have many prospective buyers who’ve registered their interest in buying into a shared ownership home. That means you’ll probably find a buyer within the allotted period, before your property goes onto the 'open market' for sale by an estate agent. Peabody’s, one of the largest housing providers in London and southeastern England, have reported finding a shared ownership buyer within the eight-week period 98.8% of the time.

Selling a shared ownership property on the open market

If your property doesn't sell within eight weeks, you may need to sell your home on the open market, with an estate agent. This is slightly more difficult than a standard home sale, because you'll have to find someone who fits the shared ownership criteria, and is able to find a suitable mortgage product to support their sale.

Whenever a potential buyer puts in an offer on your home, they will then have an interview with an independent financial adviser to make sure they are eligible for shared ownership. If they pass this stage, and a sale is agreed, your housing association will provide written confirmation of all the details (also known as the memo of sale).

Because shared ownership sales are slightly different to standard sales, making sure you work with an experienced estate agent is vital. To find the best performing estate agents in your area, try this free tool. Just pop in your postcode and it'll show you the best 6 agents operating near you.

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Can you make a profit on shared ownership?

Yes you can. Like any type of home purchase, a shared ownership property is an investment - which means, yes it is possible to make a profit on your shared ownership property. If the value of the property increases. However if the property loses value, then your share will also be worth less. There is nothing in your shared ownership agreement that would stop you taking a profit if the property sells for more.

While there is room to make a profit with a shared ownership scheme, the most common complaints from homeowners is that they have been unable to make a profit from their home sale. Shared ownership homes must be sold on at the RICS market value to give equal opportunities to homeowners in vulnerable positions.

What fees do I need to pay when selling a shared ownership property?

Different factors - chiefly, where you live, and the size of the property - affect how much you should anticipate paying in fees when selling your home. But, as a general guideline, you should budget for the following six fees/costs when selling a shared ownership property:

  1. Housing Association Marketing Fee

Many housing associations will charge a fee for their marketing costs during the nomination period. These vary but some of the larger housing associations (like Peabody) charge around £350.

  1. Valuation Fee

You will be required to cover the cost of a surveyor visiting your property and conducting a valuation. This fee depends on the location and size of your property, but you can expect it to be between £250 and £500

  1. Legal Fees

You will have to pay for both your own conveyancer, and any legal fees incurred by your housing association. Budget at least £1,000-£2,000 for this.

  1. Leasehold Information Pack

When you sell a leasehold, it’s common for the buyer’s solicitor to request a Leasehold Information Pack. This contains the details of your obligations as a leaseholder. Expect this to cost about £200.

  1. EPC

It’s a legal requirement that all properties have a valid EPC (Energy Performance Certificate) before they are put on sale. Most housing associations and estate agents will charge about £50-£100 to arrange this for you, but you can get one for less through our partners.

Does my house already have an EPC?

EPCs are valid for 10 years, and you can use the one purchased by the previous owner.
So, you may have an EPC and not know it!

  1. Assignment Fees OR Estate Agent Fees

If your housing association sells your property within the nomination period, they will take a percentage of the sale price as their fee. Peabody for example takes 1.5% plus VAT of the final sale value of your share.

If you end up selling through an estate agent, you won’t pay an assignment fee, but you will have to pay estate agent fees. Unlike assignment fees, these are charged on the full value of the property, rather than just your share.

Further steps to take

  • Get a good solicitor, at a price you can afford. You’ll rest easier knowing you’re in good hands.
  • Arrange for attractive photos and videos to be taken of the property. It’s hard to overstate how important it is for your home’s images to stand out!
  • Start looking for your new home. However, refrain from making an offer on a new property until you’ve agreed on terms with a buyer for your current home.

I can’t sell a shared ownership property

If you’re struggling to sell your shared ownership property, there’s a number of options available to you. The most common solutions are:

Get the housing association to buy back your share

The first option you have is to get the housing association to buy back your share. Unfortunately, this is unlikely to succeed. Most housing associations operate on a basis that their funds are allocated towards building more homes - not buying them back. Housing associations are under no obligations to ever buy back your share.

Back to back staircase the property

Your next option is to ‘back to back staircase’ the property. To do this, you must first find out from your HA the price of their remaining shares in the property. Then instruct the estate agent to market the property as a non-shared ownership property. The purchase of the HA’s share, your sale and the purchase by the new homeowner happen all at the same time - and you take home any leftover profit.

Sublet your property

Another option is to sublet the property. Subletting will allow you to make some profit from your unsellable home. While traditionally opposed to subletting of any kind (without 100% share ownership) a lot of housing associations now provide subletting licences to shared ownership owners. It costs them a lot less than trying to find a new owner to replace one who has given up on the property.

Wait it out

Your last option is to simply hold tight and bide your time. If you can’t sell right now, you may be able to in the future.


Can you sell a shared ownership property on the open market?

Yes you can sell a shared ownership property on the open market, but only if the housing association has given their consent.

How do I get out of a shared ownership property?

If you’re unable to get out of a shared ownership property because it won’t sell, you have a number of options available. Either get the housing association to buy back your share, back to back staircase the property, or wait for the market to open up.

Can I rent out a shared ownership property?

Yes, it’s possible to sublet and rent out your shared ownership property, but to do this you must either have 100% ownership of the property, or have a licence from your housing association.

Can I use an estate agent to sell my shared ownership property?

Yes, you can use an estate agent to sell your shared ownership property. However, the housing association may already have a list of prospective buyers ready to purchase the property, so the estate agent may not be needed. You can find the best Estate Agent for shared ownership sales here.

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Thinking about
selling your home?

Picking the right estate agent is vital for a successful sale. GetAgent makes choosing simple. Discover the best performing agents in your area.

  • Free
  • Data-driven
  • No obligation

Compare estate agents

It takes 2 minutes.

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