Property: Can't afford to buy? Why not split the cost

Purchasing a property is an expensive business, but by teaming up with a housing association you could get the house of your dreams at a reasonable price. Mary Wilson explains how

IF YOU want to buy your own home, but just cannot see a way to afford one, shared ownership may be the answer. Shared ownership schemes have been running since 1980, enabling purchasers who do not have the wherewithal to stump up the full price of a home to buy half of the property, with a housing association taking on the other half. The purchaser pays a mortgage on his half and a reduced rent (subsidised by the Government) on the other half.

In general, the costs of shared ownership are around three-quarters of what it would be if you owned all the property. If finances improve, more equity can be purchased, until you finally own it outright - or the status quo can be kept.

James Wood, a 23-year-old franking machine repair engineer, who is disabled and wheelchair-bound, had been living with his family in Galleywood, Essex but wanted to bring his girlfriend over from Ireland so they could live together in a home of their own.

The couple have taken a 50 per cent share in a two-bedroom flat at The Moorings, a Boleyn & Forest Housing Society development in Chelmsford, Essex. "The shared ownership scheme got us a home much more quickly than we could have managed otherwise" says James. "We would have needed to wait another few years to join the housing ladder if it hadn't been for shared ownership."

Another couple, Sharon and Robin White, wanted to move because although they had been happily living in a one-bedroom rented house in Barnet, north London, once their son Robert was born 14 months ago, they needed somewhere bigger.

They have bought a 25 per cent share of a new house, built by Metropolitan Home Ownership (MHO) in New Southgate, N11. This has two bedrooms, a rear garden with shed, patio and rotary drier - necessary with all the baby's washing - front garden and parking space.

"We were previously paying pounds 450 per month in rent and are now paying only a little more," says Sharon. The house was on the market for pounds 105,000 and their mortgage repayments plus rent on the remainder to the MHO costs a total of around pounds 460 a month. "It is like a dream come true. To have a house with a garden and its own parking is absolutely fantastic," she says.

Nearly 300 housing associations offer shared ownership housing and there are more than 104,000 shared ownership homes in England. A survey by the National Housing Federation (NHF) showed that just 25 of these associations took over 81,000 enquiries about shared ownership last year. "Demand could well rise, given the patchy knowledge of the tenure among potential buyers," says a spokesman from the NHF.

It is up to the private owner to look after most of the repairs and maintenance of the property, and if you wanted to make any structural alterations, permission from the housing association would be needed. Should you want to sell up, you just do so in the same way as if you owned the whole thing.

You can sell just your half, so that the new owner becomes the shared owner, or you can sell the whole property. What you do need to do, however, is to agree the value of the property with the housing association before you put it on the market and some associations keep the right to put forward potential purchasers for a short time after you have agreed to sell, which could save estate agency fees.

Many housing associations develop brand new homes specifically for shared ownership buyers, but it is possible to find your own property under the Do It Yourself Shared Ownership scheme (DIYSO). This enables someone to go out on to the open property market and find a sound, affordable home of their own choice. They then apply to a local Housing Association for acceptance on to the scheme.

Robert and Jean Stone had lived in a council flat for 22 years in Stamford Hill, east London, but wanted a better environment for their teenage children, Richard and Joanne. They applied for a DIYSO with the MHO and when accepted, went onto the open market and found the house they wanted in Chigwell, Essex.

"It has three bedrooms, a garden, private parking and a garage nearby, and we have bought a 50 per cent share in the property," says Mr Stone. The house was on the market for pounds 64,000 and the couple are now paying pounds 450 or so a month. "It is more than the pounds 62 a week rent we were paying, but that flat had no central heating, the windows were falling out and it just didn't compare with what we have got now," he says.

The criteria needed to qualify for shared ownership vary from housing association to housing association.

But in general, it is available to people nominated by a local authority on a council housing or housing association list, to people who are registered homeless or disabled, and to people who have connection with a borough, for example a nurse who needs to live near the hospital where she works. They also need to show that they can sustain the requisite mortgage/rent costs.

National Housing Federation, 0171 278 6571; Metropolitan Home Ownership, 0181 881 1234; Boleyn & Forest Housing Society, 0181 472 2233