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With Shared Ownership, you purchase a share of the property rather than having to have the funds for its full market value. For some, this can make buying a home more accessible. However, when working out what you can afford, it is important to look beyond your mortgage payment and understand all the regular costs that may come with your new home.
Your Shared Ownership monthly costs will usually include:
You will also need to budget for the everyday costs that come with running a home, including council tax, energy, water, and insurance.
In this guide, we explain the main Shared Ownership monthly costs, how they are calculated, and what to consider when planning your household budget.
If you buy a Shared Ownership home, your monthly housing costs are made up differently than buying a property outright.
The main payments you may need to budget for include:
It’s important to note that not every Shared Ownership property will have the exact same charges. The amount you pay can depend on the share you purchase, the property’s value, your mortgage, your lease, and the services provided at your development.
TIP: Before reserving a home, make sure you understand the full estimated monthly cost rather than looking at the mortgage payment alone.
With Shared Ownership, you take out a mortgage to fund the share of the property that you are buying, minus any deposit you provide.
For example, if a home is worth £250,000 and you purchase a 40% share, the share you are buying is worth £100,000. If you put down a £5,000 deposit, you would need to fund the remaining £95,000, usually through a mortgage.
Your monthly mortgage payment will depend on factors such as:
A larger deposit can reduce the amount you need to borrow, while a longer mortgage term may reduce the monthly repayment but could increase the overall amount of interest paid.
Plumlife’s Shared Ownership Affordability Calculator can help you explore how different property values, share percentages, deposits, and mortgage terms could affect your estimated monthly mortgage and rental costs.
Alongside your mortgage payments, you will also pay rent to the housing provider on the percentage of the property that you do not own.
For new-build Shared Ownership homes in England, the maximum initial rent is generally 3% of the value of the landlord’s share, although many providers set the initial rent at 2.75%. The exact figure for your home should be confirmed before you buy.
For example:
Full property value: £250,000
Share purchased: 40%
Value of your share: £100,000
Remaining 60%: £150,000
If the initial rent were calculated at 2.75% of the remaining £150,000:
£150,000 x 2.75% = £4,125 per year
£4,125 ÷ 12 = £343.75 per month
This is an example only. The actual rent for a particular property will be provided as part of the information about that home.
One way you may be able to reduce the amount of rent you pay is by purchasing a larger share of your home through staircasing.
As your ownership percentage increases, the percentage owned by the housing provider reduces. This means there is a smaller share on which rent is charged. For example, if you increased your ownership from 40% to 60%, you would then only pay rent on the remaining 40%.
You can learn more about increasing your ownership through Plumlife’s staircasing information.
Some Shared Ownership homes come with a service charge. This is particularly common for flats, apartment buildings, and developments with communal areas or shared services. This service charge contributes towards the cost of managing and maintaining areas and facilities that benefit residents.
Depending on your development, this could include:
Some properties may also have an estate charge, which can contribute towards maintaining shared outdoor areas, roads, or facilities that are not covered by the main service charge.
It is important to factor these charges into your affordability calculations before committing to a property.
As well as your mortgage, rent, and any property-related charges, you need to budget for the normal costs of running your home, such as:
Even though you may initially own only part of the property, Shared Ownership buyers can still have responsibility for maintaining their home. Exactly what you are responsible for depends on your lease, the type of property, and whether any warranties or specific repair arrangements apply.
Some newer Shared Ownership leases may include an initial repair period. Where this applies, the landlord may be responsible for certain essential structural and external repairs for a stated period of time. You should always double-check your lease to discover exactly what is included and what is your responsibility.
However, even where some repairs are covered, it is sensible to build an emergency fund for unexpected household costs.
One-off costs and expenses could include:
Imagine you are purchasing a 40% share of a home with a full market value of £250,000. The following table shows what a Shared Ownership monthly cost breakdown might look like for this type of property.
| Cost | Example |
|---|---|
| Full property value | £250,000 |
| 40% share purchased | £100,000 |
| 5% deposit on your share | £5,000 |
| Mortgage required | £95,000 |
| Example mortgage repayment* | Around £510 per month |
| Rent on remaining 60% at 2.75% | £343.75 per month |
| Example service charge | £125 per month |
| Housing costs before household bills | Around £978.75 per month |
*The example mortgage figure assumes a £95,000 repayment mortgage over 30 years at an illustrative 5% interest rate.
You would then need to also add your individual council tax, utilities, broadband, insurance, and other household spending to these monthly costs. This is why comparing Shared Ownership properties based purely on the percentage available to purchase or the mortgage payment does not provide the full picture. You should always compare the total monthly cost of each property.
Knowing what you could technically afford to borrow is only part of planning for your first home. Your monthly payments also need to fit comfortably alongside your everyday spending.
With a few simple steps, you can make budgeting easier.
Add together your estimated:
This gives you a much more useful affordability figure than considering your mortgage alone.
Mortgage rates, rent, service charges, energy bills, and council tax can all change over time.
Avoid setting a budget that only works if every cost remains exactly the same.
Unexpected home repairs and other expenses are easier to deal with if you already have money set aside. Even saving a smaller amount each month can help build a useful household emergency fund over time.
Shared Ownership charges are not identical from one development to another. Before buying, ensure you look carefully at the information provided for the property, including the rent, estimated service charge, lease, and any estate or management charges.
You can also use Plumlife’s Shared Ownership Affordability Calculator to get an initial idea of how mortgage and rental costs could look for different property values and ownership percentages.
Understanding your monthly costs before you buy can help you choose a home that suits both your needs and your finances.
With Shared Ownership, you can purchase a percentage of a property and pay rent on the remaining share, potentially reducing the amount you need for a deposit and mortgage compared with purchasing the same home outright.
Take a look at Plumlife’s Shared Ownership homes or use the Shared Ownership Affordability Calculator to explore what your estimated monthly mortgage and rental payments could look like.
Remember that affordability calculations are a guide. Your actual costs will depend on the property, mortgage product, share purchased, and charges associated with your home.
It depends on the property, the share you purchase, mortgage rates, local rents, and the other charges attached to the home.
Shared Ownership is designed to make home ownership more accessible by allowing you to buy a percentage of a property rather than the whole home. However, you should compare the complete monthly cost with your other housing options rather than assuming one will automatically be cheaper.
The main costs are usually your mortgage repayment, rent on the share you do not own, and any applicable service or estate charges. You will also be responsible for everyday household costs such as council tax, utilities, broadband, and insurance.
Shared Ownership monthly costs can increase.
Your mortgage payments can change when a fixed-rate mortgage ends or if you have a variable-rate product. Your Shared Ownership rent is normally reviewed annually in line with the lease as well, while service charges can change according to the cost of managing and maintaining the development.
Council tax and household bills may also rise or fall.
Yes. As the resident of the property, you will normally be responsible for the council tax bill even though you do not own 100% of the home.
Shared owners are responsible for many repairs and maintenance costs, although the exact position depends on the lease and the property.
Some newer leases include an initial repair period during which the landlord has responsibility for certain essential repairs. Always check the terms relating to the individual home before buying.
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