1. What is Shared Ownership Rent?

Shared Ownership is a UK government scheme that helps people buy a share of a property (between 10% and 75%) and pay rent on the remaining share. The rent is typically charged at a reduced rate compared to full market rent.

2. How Does the Calculator Work?

The calculator uses the Shared Ownership rent formula:

Where:

• \( Shared\ Ownership\ Rent\ Rate \) — Annual rent percentage charged on the unsold share
• \( Property\ Value \) — Full market value of the property
• \( Ownership\ Share \) — Percentage of the property you own

Explanation: The formula calculates the annual rent you'll pay on the portion of the property you don't own.

3. Importance of Rent Calculation

Details: Understanding your potential rent payments is crucial when considering shared ownership, as it affects your monthly outgoings and overall affordability.

4. Using the Calculator

Tips: Enter the shared ownership rent rate (typically 2.75-3% in the UK), the full property value, and your intended ownership share percentage. All values must be valid (rent rate > 0, property value > 0, ownership share between 0-100%).

5. Frequently Asked Questions (FAQ)

Q1: What is the typical shared ownership rent rate?
A: Most schemes charge between 2.75% and 3% of the unsold share's value per year.

Q2: Does the rent increase over time?
A: Yes, rent typically increases annually by RPI (Retail Price Index) plus up to 0.5%.

Q3: Can I buy more shares later?
A: Yes, through a process called "staircasing" where you can buy additional shares (usually in 10% increments).

Q4: Are there other costs besides rent?
A: Yes, you'll also need to pay service charges, ground rent (if leasehold), and your mortgage on the share you own.

Q5: Who is eligible for shared ownership?
A: Generally, first-time buyers or those who previously owned but can't afford now, with household income below £80,000 (£90,000 in London).