Help to buy and shared ownership
Updated: Mar 2, 2021
Having a small deposit doesn’t mean you can’t buy. There are a few schemes from the government to help you onto the ladder and give you added support if it’s your first home.
Help to Buy
With Help to Buy, you can buy a home with just a 5% deposit, though you can still go for a bigger deposit with Help to Buy if you like. The government then gives you a loan for up to 20% of the property’s price (40% in London). This loan stays interest-free for 5 years.
Shared ownership
Shared ownership means you buy a percentage share in the property, and rent the rest from a housing association. It means you only need to come up with a deposit for the share you want to buy – which can dramatically lower the amount you need upfront.
Read the T&Cs Get as clued up as you can on any scheme before you go for it. For example, Help to Buy is only available for specific, new build properties. And the government will own a share in your home which you’ll need to buy back, in addition to paying off the loan.
Another example for shared ownership: some housing associations don’t give up sharing – they cap the percentage you can own of your home.
Make sure you know what you’re buying, get independent legal advice where you can and talk to your broker if you’re not sure.