Shared Ownership Unpacked: Questions from our live event in Hackney Wick

We recently hosted a live event in Hackney Wick, bringing together a panel of industry experts to talk all things shared ownership, from how it works in practice to what buyers can expect from the process.

The session was recorded for our Shared Ownership Unpacked podcast and designed as an open, informative discussion. We covered a wide range of topics, with questions submitted in advance and live on the day via Slido. As expected, there were more questions than we could get through during the discussion or include in the final recording.

This page brings together those remaining questions, with clear and straightforward answers to help you better understand shared ownership and navigate the process with confidence.

Costs, renting and long term affordability

How are rent and service charges set, how often do they increase and what protections exist during periods of high inflation?

When you buy a shared ownership home, you pay rent on the part you don’t own.  For new‑build homes, the government says landlords can charge up to 3% of the value of their share, but most landlords – including us – usually charge 2.75%, or sometimes less. 
 
Your rent is reviewed once a year, every 1 April, and the rules for how it changes will be written in your lease. The increase is linked to inflation.   
Housing associations can apply smaller increases in high‑inflation years. We can choose to keep increases lower, and we have in the past, to make sure costs stay manageable for our residents. 
 
In the first year, your service charge is an estimate. This is because the building is new and there’s no past information to base the costs on. From the second year onwards, your service charge is based on the actual costs of running and maintaining the building, plus an administration fee. Any annual change will follow the rules set out in your lease.  

What do service charges cover, why do they vary between developments, and why are they often higher in inner London?

Service charges pay for the upkeep of shared services, such as cleaning, lighting, gardening, repairs, insurance, and safety checks. They differ because every building has different features and costs. Charges can vary based on: 

• Whether the building has lifts, large communal areas, or shared gardens. 
• Energy, contractor and materials costs, which have risen nationally.
• Safety requirements, which can be higher for newer or taller buildings.
• Whether the building is managed directly by us or by an external managing agent, whose fees we must pass on. 

London developments are often considered to be higher in cost, and this is because they are more likely to be flats rather than houses, meaning more shared spaces, lifts, and communal facilities to maintain, plus higher local contractor and insurance costs. 

Can buyers see a full breakdown of service charges, and why do they sometimes rise significantly over time?

Yes, buyers can see a full breakdown of the service charge. We provide this before you buy, so you understand what you’re paying for. For new‑build homes, the first year’s charges are based on estimates, because the building hasn’t been lived in before and there’s no past cost history to refer to. These estimates are usually based on similar developments, considering things like the size of communal areas and whether the building has lifts or shared gardens.  

Service charges can rise over time for several reasons. Costs such as cleaning, materials, insurance, contractor fees, and energy have increased nationally, which directly affects service charge budgets. Other cost pressures include new building safety requirements, higher insurance premiums, and increases in the cost of skilled labour. These factors are outside the landlord’s or managing agent’s control but can lead to higher year‑on‑year charges. 

Is it true that larger Shared Ownership homes can become unaffordable over time due to rising rent and charges?

It’s a fair question, and one we cover in more detail in our the podcast. In short, larger Shared Ownership homes aren’t designed to become unaffordable over time. Before anyone purchases, we carry out an affordability stress test to check that future rent and service charge increases remain manageable. This process is designed to make sure the home stays affordable in the long term. 

Are there any hidden or unexpected fees buyers should be aware of?

There are no hidden fees – everything is explained upfront before you buy. Alongside your rent and service charges, you’ll also need to budget for the usual home‑buying costs, such as solicitor fees, mortgage lender fees, surveys, and moving costs. These aren’t set by us, but they’re part of the overall cost of buying a home. 

We cover all of this in more detail in the pod, including what to expect at each stage so there are no surprises. 

Mortgages, deposits & affordability assessments

What deposit is required for Shared Ownership?

Your deposit is based only on the share you’re buying, not the full price. This is why the deposit is usually much smaller than with a traditional purchase. 

Most mortgage lenders ask for 5%–10% of the value of your share. 

For example, if you bought a 25% share of a £400,000 home, your share would be £100,000. Your deposit is based on that amount, so a 5% deposit would be £5,000, or a 10% deposit would be £10,000. 

What are the reservation fees, and is it refundable?

A reservation payment secures your new home while you progress your mortgage and legal checks. You’ll usually need to pay a reservation fee of up to £500. Often, the fee is not refundable if you decide not to go ahead, so it’s important to check the reservation agreement before paying.

If I have a larger deposit, is it better to buy a bigger share or reduce the mortgage on the initial share?

It depends on your personal situation. Buying a bigger share reduces your rent, while putting more deposit toward your mortgage reduces your monthly repayments. We can’t give financial advice as a housing association, but we can put you in touch with one of our independent financial advisers who can help you decide what’s best for you.

Are mortgage rates different for Shared Ownership?

Shared Ownership mortgages work just like normal residential mortgages, but not all lenders offer them. That means there’s a smaller pool of lenders, and as a result, rates can sometimes be slightly higher than standard mortgage deals, as there is less competition. Lenders also see mortgages on smaller shares as slightly higher risk.  

The mortgages themselves work the same way as any other – fixed or variable – with the rate depending on the lender and your circumstances.  

If you want to explore the latest rates, our panel of independent mortgage advisers can compare shared ownership‑friendly lenders for you.  

How do lenders assess affordability?

Lenders look at your income, your regular outgoings, and your combined monthly costs (mortgage, rent and service charge) to check the payments will be sustainable long‑term. The also assess things like loans, credit cards, childcare and other regular costs. The assessments aim to keep these costs within around 40-45% of your income. Lenders “stress test” your finances to check you could still afford payments if interest rates or rents increase. 

We’ll also guide you through this in the pod, but an independent mortgage adviser will give you personalised advice based on your circumstances.  

How are applicants stress-tested for affordability, including treatment of bonus or variable income?

Each lender has their own way of stress‑testing, and they don’t publish the exact calculations. In general, they check whether you could still afford your mortgage if interest rates rise or your monthly housing costs increase. This means they look at your income, regular spending, and your combined mortgage, rent and service charge to make sure everything would remain manageable even in tougher conditions. We give more guidance on how this works in the pod.  

What happens if my household income increases above the eligibility cap after I’ve moved in?

Nothing changes! The income cap only applies when you first buy your home. If your income increases later, you continue as normal. You may choose to staircase if it suits you, but there’s no requirement to do so.   

How does the cost of Shared Ownership compare financially with renting privately or buying outright?

Shared Ownership is often more affordable than renting privately, especially in higher‑cost areas. It can also be cheaper upfront than buying outright, because you only need a deposit on the share you purchase – not the full property value. Many people choose Shared Ownership because it lets them live in areas they couldn’t otherwise afford, without needing to save a much larger deposit required for full ownership.

How do you select buyers when there are multiple applicants?

We generally work on a first come first serve basis on completion of a financial assessment, unless you’re otherwise advised. Priority may be given to armed forces personnel, key workers, social housing tenants, people in housing need, and people who have a local connection to the area. 

Renting, subletting & living in the home

What are the rules on renting or subletting a Shared Ownership home, including renting rooms versus the whole property and whether the owner must live there?

Shared Ownership homes must be your main residence, so you cannot sublet the whole property. In most cases, you can rent out a spare room, but you’ll need to check your lease first.

What maintenance is the buyer responsible for including appliances or heating?

You’re responsible for all maintenance inside your home, including appliances and heating. New‑build homes come with a defect liability period from the contractor for the first two years, and the benefit of a new build guarantee such as NHBC for 10 years. Under the new Shared Ownership model, there’s also £500 a year available for certain repairs (not included in the older model).

What internal alterations are allowed (flooring, kitchens, bathrooms, walls)?

In most cases, you can make minor changes inside your home, like decorating and installing your own flooring. Bigger alterations - such as replacing kitchens or bathrooms, removing walls, or anything that affects the structure or layout - usually need permission from the landlord, as set out in your lease. We cover what’s typically allowed and how permissions work in more detail in season one episode six of the podcast.

Staircasing & ownership progression

Can you staircase in small percentages or only larger ones?
It depends on your lease. If you have a new model lease, you can buy 1% a year for 10 years with no legal or admin fees. All other leases you’ll need to staircase in larger chunks, and each step comes with fees, so may buyers wait until they can afford to buy a bigger share at once. You are also able to buy bigger shares on new model leases, but the legal and admin fees will apply.

Can you buy more shares than your initial purchase?

Yes, you’re free to buy more shares whenever you can afford to, you’re not limited to the same size share you started with. If you’re able to, you could even go from 25% to 100% ownership in a single staircasing step. We cover how staircasing works in more detail in season one episode four of the podcast. 

What are the positives and negatives of staircasing?

The positives are that you’re increasing how much you own, and you’re reducing your rent as your ownership increases. Staircasing can help you achieve 100% ownership over time, if that’s what you wish to do. Things to keep in mind are that there’s fees to pay when staircasing such as valuation fees, legal fees and admin fees. Your service charges will remain the same because they’re based on the building not the size of your share. 

Do people successfully sell after a few years of owning a 25% share?

Yes, we have seen many people sell their 25% share in the last 5 years. Shared Ownership homes are regularly sold by people who originally bought a 25% share. There’s no requirement to staircase before selling, and many buyers choose to sell their share after a few years, often to move area, upsize, or buy outright elsewhere. We also cover resales in more detail in season one episode four of the podcast. 

Who decides the price if I want to sell in the future?

The sale price is set by an independent RICS‑qualified surveyor, who provides a formal valuation. This valuation determines the price of your share for resale, and both you and the housing association must use it.

Do you have nomination rights if I want to sell, and for how long?

Yes, we’ll help you find a buyer for the first 8 weeks – we’ve got a great success rate within these 8 weeks, but we’re flexible and if we think you’d be better off going onto the open market sooner than 8 weeks we’ll work with you to achieve that. 

If the majority shareholder sells their share, can smaller shareholders be forced to sell?

No. Shared Ownership doesn’t work like a company with shareholders. You’re a leaseholder with legal rights over your share of the home, and you cannot be forced to sell if the landlord sells or transfers their share. Your lease stays in place, and the new landlord must honour it.

The only time a sale could be forced is in very rare legal circumstances (for example, a court order due to you having a high level of arrears), not because the landlord chooses to sell their interest.

Legal structure, responsibilities & risks

What is legally different about buying a Shared Ownership home compared to standard buying?

Shared Ownership is legally different because you’re buying a leasehold share. You’ll pay rent on the part you don’t own, follow rules in the lease (including for alterations and selling), and the housing association usually has first rights to find a buyer when you sell. We explain the key differences in more detail in the pod.  

Could you explain the Stamp Duty payment options?

Stamp Duty rules can be complex, and the right option depends entirely on your personal circumstances. Because of this, we don’t give Stamp Duty advice, but your solicitor will explain your options, what applies to Shared Ownership, and which approach is best for you. We recommend speaking to your solicitor early in the process, so you understand any potential costs. 

What are the risks of Shared Ownership, including what would happen if a housing association failed?

If a housing association ever failed, which is extremely rare, another regulated provider would normally take over. Your lease stays legally valid, so your rights and your home remain protected.

Why does Shared Ownership sometimes feel complicated or similar to renting?

Shared Ownership can feel confusing because it’s a mix of owning and renting. You’re a homeowner with a lease, but you also pay rent on the share you don’t own and need to follow certain rules set out in that lease, similar to renting. It can also feel complicated because it involves extra steps, like financial assessments, permissions for some changes, and a different process when selling.  

We'll be creating content like this to help support you, and our sales support team is always on hand through your buying process (something you wouldn’t get if you were renting).

Wickside specific questions

Is Wickside part of the new Shared Ownership model?

As the build on Wickside has been ongoing for some time, the development is funded under the previous model lease, and not the new model lease.

Are the Shared Ownership prices for Wickside available?

We’ll be releasing prices very soon! Keep an eye on Wickside's webpage, but we'll also email you if you have registered your interest for Wickside and not just the event.

Is this development only reserved for Tower Hamlets residents?

Tower Hamlets Residents will receive priority in cases where we have multiple people applying for the same home and successfully completing a financial assessment, but it is not reserved specifically for those with a borough connection.

What is the minimum household income required for a two bed Shared Ownership home?

There isn’t a fixed minimum as it will depend on what deposit you have, and what size share you want to buy. Because everyone’s situation is different, the best next step is to speak to one of our panel of mortgage advisers to understand what’s affordable to you.  It's worth mentioning that there is certain eligibility criteria you have to meet though, being over 18, not owning another home, and earning under £90,000 (£80,000 outside of London). We give more detail on eligibility criteria in our frequently asked questions.

Why are the service charges on your homes higher than nearby developments?

Service charges can differ between developments because they all have different costs and requirements. This could be down to the level and standard of lifts, shared spaces, gardens, lighting and security. Fire safety, energy costs, insurance and contractor costs will all also have a bearing on the overall cost of a development. 

Thank you to everyone who joined us at our Hackney Wick event and took the time to submit such thoughtful questions.

Taking the time to research, read, and ask questions is one of the most important steps in starting your home buying journey, and we hope this has helped give you a clearer understanding of how shared ownership works and what to expect.

If you’d like to keep exploring, you can watch the live podcast episode from the event, dive into the full Shared Ownership Unpacked series, or find out more about Wickside and upcoming homes. You can also create an account to manage your home search or explore more about shared ownership through our guides and FAQs.