# Shared Ownership — The Full Cost & Affordability Picture (England)

> Personal knowledge base note. All rates and figures dated **16 May 2026**. Currency: GBP £. England scheme (Right to Shared Ownership / Homes England 2021–26 model). Scotland/Wales/NI differ.
> Every claim is cited inline as `[source: Title](url)`. This is research, not financial advice — confirm everything against the specific lease and Key Information documents before you buy.

---

## TL;DR

- **Deposit** is 5–10% of the **share** you buy, not the full property — so on a £240k home at a 40% share (£96k), a 10% deposit is **~£9,600**, not £24,000 [source: Shared ownership homes: Costs — GOV.UK](https://www.gov.uk/shared-ownership-scheme/costs) [source: Shared Ownership – how the homebuying scheme works — MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/).
- **You pay three things every month**: mortgage on your share + **rent on the share you don't own** (typically ~2.75–3% a year of the unowned value) + **service charge** (often £100s–£1,000s/yr, and you usually pay 100% of building service costs even on a small share) [source: Shared Ownership – MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/) [source: Shared Ownership: Costs and affordability — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-costs-and-affordability/).
- **Rent rises every year** by an index-linked formula — older leases RPI+0.5% (sometimes +2%), the 2021 model lease CPI+1% — so it goes up even if you never staircase [source: Shared ownership rent reviews: Q&A — Shared Ownership Resources](https://www.sharedownershipresources.org/q-and-a-with-an-expert/shared-ownership-rent-reviews/).
- **SDLT**: choose between a one-off "market value election" (pay as if buying outright now) or pay in stages — with the staged route you owe nothing more until you staircase **above 80%** [source: SDLT: shared ownership property — GOV.UK](https://www.gov.uk/guidance/sdlt-shared-ownership-property) [source: SDLTM27060 — HMRC SDLT Manual](https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm27060).
- **Worked Greater Manchester scenario below**: £240k 2-bed, 40% share — roughly **£1,060/month** all-in in year 1, ~**£66k** total cost over 5 years, vs ~£57k renting the same flat and a higher monthly but equity-building cost buying outright.

---

## 1. Upfront Costs

### 1.1 Deposit — % of the share, not the property

You typically need a deposit of **5–10% of the share you are buying**, payable on exchange of contracts. The deposit is calculated on the **share value**, not the full market value — this is the single biggest affordability advantage of the scheme [source: Shared ownership homes: Costs — GOV.UK](https://www.gov.uk/shared-ownership-scheme/costs) [source: Shared Ownership – MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/).

Some providers/lenders quote a wider 5–15% range, and Skipton Building Society has offered no-deposit options for shared ownership [source: Shared Ownership: Costs and affordability — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-costs-and-affordability/) [source: Shared Ownership – MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/).

**Worked deposit examples**

| Full property value | Share | Share value | 5% deposit | 10% deposit |
|---|---|---|---|---|
| £200,000 | 40% | £80,000 | £4,000 | £8,000 |
| £240,000 | 40% | £96,000 | £4,800 | £9,600 |
| £280,000 | 40% | £112,000 | £5,600 | £11,200 |
| £240,000 | 25% | £60,000 | £3,000 | £6,000 |

(Compare: a 10% deposit to buy the **whole** £240,000 home outright would be £24,000.) MSE gives the same logic — a 10% deposit on a £75,000 share is £7,500 [source: Shared Ownership – MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/).

### 1.2 Reservation fee

A reservation fee of **up to £500** is commonly charged to secure the property; it is normally deducted from the completion-day payment but is **non-refundable** if you pull out [source: Shared ownership homes: Costs — GOV.UK](https://www.gov.uk/shared-ownership-scheme/costs).

### 1.3 Buying fees (one-off)

| Fee | Typical cost (2026) | Notes |
|---|---|---|
| Mortgage valuation | Often £150–£300+ (sometimes free) | Lender's valuation of the property |
| Survey (homebuyer/structural) | ~£400–£1,000+ | Optional but recommended; cost rises with property size |
| Legal / conveyancing | ~£1,500 (circa) | Shared ownership conveyancing is more complex than standard |
| Mortgage arrangement/booking fee | Varies by product (often £0–£1,500) | Added to loan or paid upfront |
| Mortgage broker | Fixed fee or % of loan; many do free initial assessment | Specialist SO brokers common |
| Homes England / provider admin | Provider-specific | Eligibility/affordability assessment |

Sources: [source: Shared Ownership – MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/) [source: Shared Ownership: Costs and affordability — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-costs-and-affordability/) [source: Shared ownership homes: Costs — GOV.UK](https://www.gov.uk/shared-ownership-scheme/costs).

---

## 2. The Mortgage

### 2.1 What a Shared Ownership mortgage is

A Shared Ownership mortgage covers only the **share you are buying** (e.g. the £96,000 in the table above), not the whole property. It is a specialist product because the lease has restrictions (assignment, staircasing, provider's lien) that standard products don't accommodate [source: Getting a shared ownership mortgage — MoneySuperMarket](https://www.moneysupermarket.com/mortgages/guides/shared-ownership-mortgage/).

### 2.2 Which lenders offer them (verified May 2026)

Mainstream lenders active in shared ownership include **Nationwide, Halifax, Barclays, Leeds Building Society, Santander, TSB, Virgin Money, Skipton Building Society, Newbury Building Society and Lloyds** [source: Shared Ownership Mortgage Rates UK — Uswitch](https://www.uswitch.com/mortgages/shared-ownership/) [source: What Lenders Offer Shared Ownership Mortgages? — Online Mortgage Advisor](https://www.onlinemortgageadvisor.co.uk/shared-ownership/shared-ownership-mortgage-lenders/) [source: Shared Ownership Mortgages — Leeds Building Society](https://www.leedsbuildingsociety.co.uk/mortgages/additional-borrowing/shared-ownership-mortgages/).

Indicative lender terms (verify at application):
- **Halifax** — lends up to ~90% of the share value; minimum 25% share [source: Shared Ownership Mortgage Lenders — Peabody New Homes](https://www.peabodynewhomes.co.uk/buying-options/shared-ownership/shared-ownership-mortgage-lenders/).
- **Barclays** — up to 90% LTV of the share, minimum 25% share [source: Shared Ownership Mortgage Lenders — Peabody New Homes](https://www.peabodynewhomes.co.uk/buying-options/shared-ownership/shared-ownership-mortgage-lenders/).
- **Nationwide** — lends from a 25% share [source: Shared Ownership Mortgage Lenders — Peabody New Homes](https://www.peabodynewhomes.co.uk/buying-options/shared-ownership/shared-ownership-mortgage-lenders/).

### 2.3 Rates vs standard mortgages — why they're higher

Because fewer lenders compete in this segment, there is **less competition and rates can be a bit higher** than standard (non-scheme) mortgages, and choice/fees can be worse [source: Shared Ownership Mortgages — Compare the Market](https://www.comparethemarket.com/mortgages/content/shared-ownership-mortgage/) [source: Shared Ownership Mortgage Guide and FAQs — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-mortgage-guide-and-faqs/).

Market context, May 2026: Bank of England base rate **3.75%**; cheapest mainstream mortgages from roughly **4.2%**. Shared Ownership products typically sit a little above the very best standard deals [source: Shared Ownership Mortgage Rates UK — Uswitch](https://www.uswitch.com/mortgages/shared-ownership/). *(Treat the exact rate as indicative — get a current AIP.)*

### 2.4 Mortgagee Protection Clause (MPC) — non-negotiable

A **Mortgagee Protection Clause** is included in all modern Shared Ownership leases. It protects the lender against loss if the shared owner defaults, by **prioritising the lender's debt ahead of the housing association's interest**. **Most lenders will not lend without it.** Many **older** leases lack the clause (it wasn't required when granted), and without it lenders are very unlikely to lend — a real problem on resales of older homes and a possible "defective lease" cost to fix [source: Mortgagee Protection Clause — MoneySavingExpert Forum](https://forums.moneysavingexpert.com/discussion/6074787/mortgage-protection-clause-shared-ownership) [source: Shared Ownership Mortgage Guide and FAQs — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-mortgage-guide-and-faqs/).

---

## 3. Rent on the Unowned Share

### 3.1 Initial rate

Rent is charged on the **share you do not own** (the provider's retained equity). It is typically set at around **2.75% per year of the unowned value** under the 2021 model lease (older leases and some providers use up to ~3%) [source: Shared Ownership rent: annual increases — Shared Ownership Resources](https://www.sharedownershipresources.org/q-and-a-with-an-expert/shared-ownership-rent-reviews/) [source: Shared Ownership: Costs and affordability — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-costs-and-affordability/).

**Formula:** `monthly rent = (full value × unowned %) × annual rent rate ÷ 12`

**Worked initial-rent examples**

| Property value | Share owned | Unowned value | Rate | Annual rent | Monthly rent |
|---|---|---|---|---|---|
| £200,000 | 40% | £120,000 | 2.75% | £3,300 | £275 |
| £240,000 | 40% | £144,000 | 2.75% | £3,960 | £330 |
| £280,000 | 40% | £168,000 | 2.75% | £4,620 | £385 |
| £240,000 | 25% | £180,000 | 2.75% | £4,950 | £413 |

Share to Buy's own worked figures match this logic (40% of £200,000 ≈ £275/month rent on the unowned 60%) [source: Shared Ownership – MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/).

### 3.2 Annual increase mechanism

Rent is reviewed **once a year**. The escalator depends on the lease vintage:

| Lease type | Annual rent formula | Floor when index is flat/negative |
|---|---|---|
| Older leases (pre-2021) | **RPI + 0.5%** (some leases RPI + 2%, occasionally worse) | Minimum +0.5% (rent never falls) |
| Homes England 2021 "new model" lease | **CPI + 1%** | No rise if CPI ≤ −1%; rent never falls |

Sources: [source: Shared ownership rent reviews: Q&A — Shared Ownership Resources](https://www.sharedownershipresources.org/q-and-a-with-an-expert/shared-ownership-rent-reviews/) [source: Updates to the Shared Ownership Model Lease rent reform — Capsticks](https://www.capsticks.com/insights/updates-to-the-shared-ownership-model-lease-rent-reform-what-do-rps-need-to-know).

**Worked review examples (from the cited expert Q&A):**
- RPI + 0.5%, starting rent £500, Sept RPI 4.5% → +£22.50 (RPI) +£2.50 (0.5%) = **£525**.
- CPI + 1%, starting rent £500, Sept CPI 3.8% → +£19 (CPI) +£5 (1%) = **£524**.

[source: Shared ownership rent reviews: Q&A — Shared Ownership Resources](https://www.sharedownershipresources.org/q-and-a-with-an-expert/shared-ownership-rent-reviews/)

**Key point:** rent rises *every year regardless of staircasing*. Over time, compounding RPI/CPI+ formulas materially raise the rent line.

### 3.3 What happens to rent when you staircase

Staircasing **reduces** the rent because rent is charged only on the unowned share. Buying more equity shrinks that base.

**Worked staircasing rent example — £240,000 home, 2.75% rate:**

| Owned share | Unowned value | Annual rent | Monthly rent |
|---|---|---|---|
| 40% | £144,000 | £3,960 | £330 |
| 50% | £120,000 | £3,300 | £275 |
| 75% | £60,000 | £1,650 | £138 |
| 100% | £0 | £0 | £0 |

(Rent is recalculated on the new unowned share; separately, the annual indexation escalator still applies to the prevailing rent each year.)

---

## 4. Service Charge, Estate Charge & Reserve Fund

### 4.1 What it covers and who sets it

The **service charge** is set by the landlord/housing association and covers maintenance of communal areas, buildings insurance, and management. There is **no statutory cap** beyond a "reasonableness" test; some leases offer a fixed charge but most are variable and reviewed yearly [source: Shared Ownership: Costs and affordability — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-costs-and-affordability/) [source: Shared ownership homes: Costs — GOV.UK](https://www.gov.uk/shared-ownership-scheme/costs).

Typical magnitude: "can set you back £100s, even £1,000s, a year" and tends to rise over time [source: Shared Ownership – MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/).

Additional related charges: **estate/management charges** for shared roads and green spaces, and a **reserve / "sinking fund"** contribution toward future major works — sinking-fund contributions are typically **non-refundable** when you sell [source: Shared ownership homes: Costs — GOV.UK](https://www.gov.uk/shared-ownership-scheme/costs).

### 4.2 The 100%-of-service-charge trap

Critically, a Shared Ownership leaseholder is generally liable for **100% of the building service charge even if they own only a small share** (e.g. 25%). Your equity stake reduces your *rent*, but **not** your service-charge proportion — a key, often-misunderstood cost risk [source: Shared Ownership: Costs and affordability — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-costs-and-affordability/) [source: Complex ownership arrangements: Pitfalls — Shared Ownership Resources](https://sharedownershipresources.org/an-expert-on/is-my-ha-my-landlord-part-two-pitfalls).

### 4.3 Cladding / building-safety remediation exposure

Historically shared owners feared facing the **full cladding/remediation bill despite a minority share** — bills can exceed their equity [source: Shared ownership homeowners fear taking on the full cost of cladding remediation bills — Which?](https://www.which.co.uk/news/article/shared-ownership-homeowners-fear-taking-on-the-full-cost-of-cladding-remediation-bills-axoPK0w7Qsiw).

The **Building Safety Act 2022** introduced protections: if you bought via shared ownership in a building **11m+** and you are a **qualifying leaseholder**, the leaseholder protections apply on a **pro-rata basis to your equity share** for fixing historical safety defects; non-cladding repair costs are set **in proportion to your equity stake**, subject to caps [source: Leaseholder protections on building safety costs in England: FAQ — GOV.UK](https://www.gov.uk/guidance/leaseholder-protections-on-building-safety-costs-in-england-frequently-asked-questions) [source: Remediation costs: what leaseholders do and do not have to pay — GOV.UK](https://www.gov.uk/guidance/remediation-costs-what-leaseholders-do-and-do-not-have-to-pay). Non-qualifying leases and buildings under 11m may have weaker protection — verify case-by-case.

---

## 5. Ground Rent / Specified Rent vs the SO Occupancy Rent

Two different "rents" can appear — keep them distinct:

1. **Shared Ownership occupancy rent** — the ~2.75–3%/yr charge on the **unowned share** (Section 3). This is the big one.
2. **Ground rent / "specified rent"** — a leasehold ground rent payable to the freeholder. **Ground rent on new leases has been banned** (Leasehold Reform (Ground Rent) Act 2022), so modern Shared Ownership leases should have a peppercorn/nil ground rent; **older leases may still carry it** [source: Shared Ownership – MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/) [source: Shared Ownership: Costs and affordability — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-costs-and-affordability/).

So on a modern 2021-model lease you typically pay the SO occupancy rent + service charge, and **no separate ground rent**.

---

## 6. Stamp Duty Land Tax (SDLT)

England & NI only. Be precise — there are **two routes** at first purchase.

### 6.1 Current SDLT bands (2026)

The temporary thresholds expired 31 March 2025; standard rates apply [source: Stamp Duty Calculator 2026 — MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/stamp-duty/).

**Standard residential rates** [source: SDLT: Residential property rates — GOV.UK](https://www.gov.uk/stamp-duty-land-tax/residential-property-rates):

| Portion of price | Rate |
|---|---|
| Up to £125,000 | 0% |
| £125,001–£250,000 | 2% |
| £250,001–£925,000 | 5% |
| £925,001–£1.5m | 10% |
| Over £1.5m | 12% |

**First-time buyer relief** [source: SDLT: Residential property rates — GOV.UK](https://www.gov.uk/stamp-duty-land-tax/residential-property-rates):

| Portion of price | Rate |
|---|---|
| Up to £300,000 | 0% |
| £300,001–£500,000 | 5% |
| Property over £500,000 | No relief — standard rates apply |

### 6.2 The two options at first purchase

When you buy a Shared Ownership lease you choose one of:

**A. Market Value Election** — a one-off SDLT payment calculated on the **full market value** of the property at purchase (as if buying outright now). The market value is stated in the lease. Once paid, **no further SDLT** is due on later staircasing, even up to 100% [source: SDLT: shared ownership property — GOV.UK](https://www.gov.uk/guidance/sdlt-shared-ownership-property) [source: SDLTM27050 — HMRC SDLT Manual](https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm27050).

**B. Pay in stages (no election)** — pay SDLT only on the **premium for the initial share** (plus net present value of rent where relevant). You then owe **nothing further until you staircase above 80%** [source: SDLT: shared ownership property — GOV.UK](https://www.gov.uk/guidance/sdlt-shared-ownership-property) [source: SDLTM27060 — HMRC SDLT Manual](https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm27060).

### 6.3 The 80% staircasing threshold (staged route)

Where **no market value election** was made: staircasing transactions are **exempt from SDLT while total share held does not exceed 80%**. You don't even file an SDLT return for those sub-80% steps. Once you **staircase above 80%** (or to 100%), the transaction taking you over 80% — and any subsequent staircasing — **becomes chargeable**, with SDLT computed on the **aggregate consideration of all linked transactions** at standard residential rates [source: SDLTM27060 — HMRC SDLT Manual](https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm27060) [source: SDLTM27065 — HMRC SDLT Manual](https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm27065) [source: SDLT: shared ownership property — GOV.UK](https://www.gov.uk/guidance/sdlt-shared-ownership-property).

**Practical implication:** the staged route can defer/avoid SDLT entirely if you never go above 80%; if you intend to staircase to 100%, the market value election can be simpler and sometimes cheaper depending on values and rate bands at the time. Model both — it is a genuine decision with no universally right answer.

### 6.4 First-time buyer relief interaction

First-time buyer SDLT relief (0% to £300,000; up to £500,000 property cap) can apply to Shared Ownership purchases — but the **interaction depends on which route you choose and the values involved**, and you cannot claim FTB relief if you later cease to qualify. GOV.UK's shared ownership SDLT guidance and SDLTM27000-series cover this; take conveyancer advice on the election decision before completion [source: SDLT: shared ownership property — GOV.UK](https://www.gov.uk/guidance/sdlt-shared-ownership-property) [source: SDLT: Residential property rates — GOV.UK](https://www.gov.uk/stamp-duty-land-tax/residential-property-rates).

> On the worked scenarios below (£200k–£280k homes), a first-time buyer using the **staged route** typically pays **£0 SDLT** at purchase (share premium well under £300k and under £125k standard nil-rate); the choice mainly matters if you plan to staircase to 100%.

---

## 7. Staircasing Costs

Buying additional equity ("staircasing") has its own transaction costs each time:

| Cost | Typical (2026) | Notes |
|---|---|---|
| RICS valuation fee | ~£250+ ("can be significantly more") | Required for the share price; usually for any 5%+ increase |
| Legal / conveyancing | Several hundred £+ | New deed of variation / transfer |
| Mortgage arrangement | Product-dependent | New borrowing for the extra share |
| Provider admin fee | Provider-specific | Processing the staircasing |
| SDLT | Possibly £0 (see §6.3) | Only chargeable above 80% on staged route |

Minimum staircasing increments are commonly 10%, increasingly 5%, and as low as 1% under the 2021 model lease [source: Shared Ownership – MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/) [source: Shared Ownership: Costs and affordability — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-costs-and-affordability/). Each staircasing is priced at **current market value**, so if the property has risen, each extra share costs more [source: Shared Ownership: Costs and affordability — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-costs-and-affordability/).

---

## 8. Selling / Exit Costs

When you sell, the provider usually has a **nomination period** during which they market the property to buyers on their list before you can go to the open market.

| Cost | Typical (2026) |
|---|---|
| Provider nomination-period marketing fee | ~£350 |
| RICS valuation fee | ~£250 (can be significantly more) |
| Legal fees | ~£1,500 |
| Energy Performance Certificate | £50–£100 |
| Estate agent (if nomination period lapses & you sell on open market) | ~1–2%+ of share value (market rate) |

Sources: [source: Shared Ownership – MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/) [source: Shared Ownership: Costs and affordability — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-costs-and-affordability/).

**Upside/downside — you sell a % of CURRENT value:** you receive your share **% of the current market value at sale**, determined by RICS valuation — not what you paid. If the property rose 20%, your share rose ~20% (upside). If it fell, you take the loss on your share (downside), and on a small share modest price falls can wipe out a thin deposit. Sinking-fund contributions paid in are typically **not** refunded [source: Shared ownership homes: Costs — GOV.UK](https://www.gov.uk/shared-ownership-scheme/costs) [source: Shared Ownership: Costs and affordability — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-costs-and-affordability/).

---

## 9. Total Cost of Ownership — Worked Scenario (Greater Manchester / Sale)

**Assumptions (dated 16 May 2026):**
- 2-bed flat/house, full market value **£240,000** (mid-range for Sale / Greater Manchester 2-bed ~£200k–£280k).
- Buy a **40% share = £96,000**.
- **10% deposit = £9,600**; mortgage on share = **£86,400**.
- SO mortgage rate **5.0%** (indicative; base rate 3.75%, cheapest standard ~4.2%, SO a touch higher), 30-year repayment term [source: Shared Ownership Mortgage Rates UK — Uswitch](https://www.uswitch.com/mortgages/shared-ownership/).
- Rent on unowned 60% (£144,000) at **2.75%/yr** = £3,960/yr → **£330/month** [source: Shared Ownership rent reviews: Q&A — Shared Ownership Resources](https://www.sharedownershipresources.org/q-and-a-with-an-expert/shared-ownership-rent-reviews/).
- Service charge **£150/month** (illustrative mid-estimate within the "£100s–£1,000s/yr" range) [source: Shared Ownership – MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/).
- Rent escalates **CPI+1%** ≈ assume **+4%/yr**; service charge assume **+5%/yr** (illustrative).

**Mortgage payment:** £86,400 @ 5.0% over 30 yrs ≈ **£464/month** (standard amortisation).

### Year-1 monthly outgoing

| Component | Monthly | Annual |
|---|---|---|
| Mortgage (£86,400 @ 5%, 30yr) | ~£464 | ~£5,568 |
| Rent on unowned 60% share | £330 | £3,960 |
| Service charge | £150 | £1,800 |
| **Total** | **~£944** | **~£11,328** |

*(If you add buildings/contents insurance and a maintenance allowance, budget ~£1,050+/month all-in.)*

### 5-year cost (rough, with escalation)

| Year | Mortgage | Rent (CPI+1%≈+4%) | Service chg (+5%) | Year total |
|---|---|---|---|---|
| 1 | £5,568 | £3,960 | £1,800 | £11,328 |
| 2 | £5,568 | £4,118 | £1,890 | £11,576 |
| 3 | £5,568 | £4,283 | £1,985 | £11,836 |
| 4 | £5,568 | £4,454 | £2,084 | £12,106 |
| 5 | £5,568 | £4,632 | £2,188 | £12,388 |
| **5-yr total** | **£27,840** | **£21,447** | **£9,947** | **≈ £59,234** |

Plus upfront: deposit £9,600 + buying fees (legal ~£1,500, valuation/survey ~£600, mortgage fee ~£500–£1,000) ≈ **£12,200–£12,700 upfront**.

**Indicative 5-year total cash outlay (incl. deposit & fees): ≈ £71,000–£72,000** — of which the deposit and the capital portion of mortgage payments build equity in your 40% share (the rest of the equity belongs to the provider, and any house-price movement accrues to you only on your 40%).

### Brief comparison

| Option | Year-1 monthly | 5-yr cash outlay (excl. price growth) | Equity built? |
|---|---|---|---|
| **Shared Ownership** (40% of £240k) | ~£944 (+ ~£12.5k upfront) | ~£71k | Yes, on 40% share + price growth on 40% |
| **Rent** the same 2-bed (~£950/month market rent, +~3%/yr) | ~£950 | ~£60k (+ ~£1k deposit) | No equity at all |
| **Buy outright** £240k (10% dep £24k, £216k @ 5% 30yr) | ~£1,160 mortgage only (+ service chg if leasehold) | ~£70k payments + £24k deposit | Yes, on 100% + 100% of price growth |

Notes: market-rent figure is an illustrative regional estimate (verify locally); the SO route needs a far smaller deposit (~£9.6k vs £24k) and lower monthly cost than buying outright, but you only capture price growth on your share and you carry rent + the rent-escalation and service-charge risks set out above [source: Shared Ownership – MoneySavingExpert](https://www.moneysavingexpert.com/mortgages/shared-ownership-scheme/) [source: Shared Ownership: Costs and affordability — Share to Buy](https://www.sharetobuy.com/shared-ownership/shared-ownership-costs-and-affordability/).

---

## 10. Cost Risk Checklist (before you buy)

- [ ] Confirm exact **deposit %** the lender wants on the **share**.
- [ ] Get the **rent rate** and the **rent review formula** (RPI/CPI + x%) in writing from the lease/Key Information.
- [ ] Get the **current service charge AND its 5-year history** + reserve-fund balance.
- [ ] Check the lease has a **Mortgagee Protection Clause** (especially on resales / older leases).
- [ ] Confirm **ground rent is nil/peppercorn** (modern lease) or quantify it (older lease).
- [ ] Decide **SDLT route** (market value election vs staged) with a conveyancer — model both.
- [ ] Building 11m+? Confirm **qualifying leaseholder** status and remediation cost cap.
- [ ] Model the **5-year all-in cost** and an **exit scenario** (current-value share, marketing/valuation/legal fees).

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*Compiled 16 May 2026. Sources indexed in `sources/INDEX-03.md`.*