Help to Buy & Shared Ownership Affordability Checker UK 2025

Help to Buy, Shared Ownership & First-Time Buyer Schemes in the UK

Getting onto the property ladder remains one of the biggest financial challenges facing UK households. A range of government-backed schemes exists — or existed — to help first-time buyers and those who cannot afford to buy outright on the open market. Understanding the differences, eligibility criteria, and true costs of each scheme is essential before committing.

Help to Buy Equity Loan — Historical Overview

The Help to Buy: Equity Loan scheme was available in England from 2013 until 31 March 2023, when it closed to new applications. Under the scheme, the government lent buyers up to 20% of the purchase price of a new-build home (40% in London), interest-free for the first five years. Buyers needed only a 5% deposit and took out a repayment mortgage on the remaining amount. From year six, interest was charged on the equity loan at 1.75%, rising annually by the Consumer Price Index (CPI) plus 2%.

While no new Help to Buy equity loans are available, hundreds of thousands of households still have equity loans outstanding. If you are one of them, you should be aware that your interest charges will have been rising since 2018 (for those who purchased early in the scheme), and that you will need to repay the equity loan when you sell, remortgage, or at the end of the mortgage term — and the repayment amount is tied to the property's current market value, not the original loan amount.

Shared Ownership — How It Works

Shared Ownership is a government scheme administered through Housing Associations (Registered Providers) that allows eligible buyers to purchase a share — typically between 10% and 75% — of a property, paying rent to the Housing Association on the remaining share. It is available on new-build and resale properties.

The key mechanics are:

• You take out a mortgage on your share only, so the deposit and mortgage required are substantially lower than for an outright purchase.
• You pay rent to the Housing Association on the unsold share, typically at around 2.75% of the unsold share value per year, charged monthly.
• You pay service charges and, for houses, ground rent (though the Leasehold Reform (Ground Rent) Act 2022 abolished ground rent on new leases from June 2022).
• Over time you can buy additional shares through a process called staircasing, eventually reaching 100% ownership in most cases.

Eligibility for Shared Ownership

To be eligible for Shared Ownership in England you must:

• Have a combined household income of no more than £80,000 per year (£90,000 in London).
• Be a first-time buyer, or a previous homeowner who cannot afford to buy outright.
• Be unable to afford all of the monthly mortgage payments for a property that meets your housing needs on the open market.
• Not currently own a home (or be in the process of selling one — exceptions apply in some cases).

Priority is given to serving and veteran armed forces personnel, and some local authorities reserve allocations for people with a local connection.

Staircasing — Buying More Shares

One of the main advantages of Shared Ownership is the ability to gradually increase your ownership share. Staircasing allows you to buy additional tranches of equity — usually in minimum 5% or 10% increments — at the current market value. Each staircase transaction incurs valuation costs (typically £300–£700), legal fees, and potentially Stamp Duty Land Tax (though first-time buyers pay SDLT on the initial purchase only, until they reach 80% ownership under the new model lease terms).

Once you own 100% of the property, you will no longer pay rent on the unsold share and will hold the property freehold (for houses) or on the remaining leasehold term (for flats).

Selling a Shared Ownership Property

Selling a shared ownership property is more complex than selling an open market property. The Housing Association usually has a nomination period — typically eight weeks — during which they have the right to find another eligible shared ownership buyer before you can sell on the open market. If you have staircased to 100%, you can sell normally on the open market. Legal advice is strongly recommended before selling.

Lease Terms and Service Charges

Shared Ownership properties are sold on a long lease — typically 99 to 125 years. You should check the remaining lease length carefully, as a lease below 80 years becomes increasingly difficult to mortgage and sell, though leaseholders have statutory rights to extend their lease (see the Leasehold Reform Act 2024 for significant changes to extension rights and costs).

Service charges — covering the maintenance of communal areas, buildings insurance, and management costs — are a significant ongoing cost for shared ownership (and leasehold) properties. These can range from under £100 per month to over £500 per month in some developments, and are not capped.

First Homes Scheme

The First Homes scheme, launched in June 2021, offers eligible first-time buyers, key workers, and local people a discount of at least 30% (and up to 50% in some areas) off the market value of new-build properties. The discount is attached to the property in perpetuity — meaning that when you sell, you must sell at the same percentage discount to another eligible buyer. Properties must be priced at no more than £250,000 after the discount (£420,000 in London).

Stamp Duty Land Tax Relief for First-Time Buyers

First-time buyers in England benefit from SDLT relief. From April 2025, the SDLT-free threshold reverted to its pre-September 2022 level:

• No SDLT on the first £300,000 of the purchase price.
• 5% on the portion between £300,001 and £500,000.
• Properties above £500,000 do not qualify for first-time buyer relief at all.

For Shared Ownership, first-time buyers can elect to pay SDLT on the full market value upfront (to avoid further SDLT on staircasing) or to pay in stages, paying only on the initial share at purchase and then when staircasing exceeds 80%.

Mortgage Guarantee Scheme

The Mortgage Guarantee Scheme — extended to June 2025 and likely to be succeeded by a similar product — allows buyers to purchase a property with only a 5% deposit on homes valued up to £600,000. Under the scheme, the government provides lenders with a guarantee on the portion of the mortgage between 80% and 95% loan-to-value, reducing the risk to lenders and enabling them to offer 95% LTV mortgages to a wider range of buyers. It is available to both first-time buyers and home movers on repayment mortgages.

Frequently Asked Questions

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