Shared Ownership Costs: Mortgage Plus Rent, Side by Side

Shared ownership looks cheaper until you add both monthly bills together. This guide adds them properly, share by share.

What is the Shared Ownership Affordability Calculator?

Shared ownership splits a home into two monthly costs: a mortgage on the share you buy and rent on the share you do not own. Enter the full market value, the share to buy, the rent rate on the unowned share (2.75% a year is typical, reviewed annually), your deposit, the mortgage rate and term, and your household income. The tool returns the share price, the mortgage on that share, the monthly mortgage payment, the monthly rent, the total monthly housing cost and what share of your monthly income that takes. Providers look at the total monthly cost against your income and check that the mortgage itself is affordable on its own. The total here excludes any service charge, which is charged separately and should be added to your own budget. You can usually buy more shares later through staircasing, in chunks, until you own 100% in most cases, with each step needing a fresh valuation and affordability check. Estimates only, not financial advice.

How to use it

1. Enter the full market value of the property and the percentage share you want to buy.
2. Enter the rent rate charged on the unowned share (2.75% a year is typical), your deposit, the mortgage rate and term, and your household income.
3. Click Calculate Shared Ownership Cost to see the share price, the mortgage, the monthly rent, the total monthly cost and what share of your income that takes.

Worked example

A £300,000 home at a 50% share costs £150,000. With a £15,000 deposit the mortgage is £135,000, about £724.71 a month at 5% over 30 years (the source rounds this to about £725). Rent on the other £150,000 at 2.75% is £343.75 a month, so the total housing cost is about £1,068.46 a month, about 36.63% of a £35,000 income (the source rounds this to about £1,069 and 36.6%).

What is the total monthly cost of a 50% share of a £300,000 home?

The share costs £150,000, the mortgage on it after a £15,000 deposit is £135,000 at about £724.71 a month at 5% over 30 years, and rent on the unowned £150,000 at 2.75% is £343.75 a month, giving a total of about £1,068.46 a month — about 36.63% of a £35,000 income, before any service charge.

Frequently asked questions

How is affordability calculated for shared ownership?

Providers look at the total monthly cost — mortgage plus rent plus service charge — against your income, and check that the mortgage itself is affordable on its own.

What is the rent on the unowned share?

You pay rent to the housing provider on the share you do not own, usually around 2.75% of that share's value per year, reviewed annually.

Can I buy more shares later?

Yes, through staircasing you can buy further shares, usually in chunks, until you own 100% in most cases. Each step needs a fresh valuation and affordability check.

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