Older Persons Shared Ownership: buying a share of a home from age 55

Older Persons Shared Ownership (OPSO) is a scheme that lets people aged 55 or over buy a share of a home and pay rent on the part they do not own. You must be 55 or over to buy an OPSO home, and the scheme follows the same rules as the standard shared ownership scheme¹. You buy a share, usually with a mortgage or with savings or the equity from selling your current home, and you pay rent on the rest².

The share you buy is between 10% and 75% of the home³. You need a deposit, usually between 5% and 10% of the share you are buying¹. Once you own 75% of the home you do not have to pay rent on the remaining 25% share¹. You can buy more shares over time, which is called staircasing, and if you buy more shares you pay less rent¹.

The scheme is for people who cannot afford all of the deposit and mortgage payments for a home that meets their needs¹. It is not the same as Help to Buy, which has closed, and it is not the same as the Right to Shared Ownership, which is for tenants in social and affordable rent homes⁴. This page explains how OPSO works, who can apply, what it costs, and what happens when you sell or move out.

How Older People's Shared Ownership works: a share of the home from age 55

OPSO is a form of shared ownership designed for older buyers. You must be 55 or over to buy an OPSO home, but your spouse or civil partner may also be able to live there if they are under 55 when you buy it¹. The scheme follows the same rules as the standard shared ownership scheme, so the mechanics of buying a share, paying rent and staircasing are the same¹.

You buy an initial share of the home, and the housing provider owns the rest. The share you buy is between 10% and 75% of the home³. You pay rent to the landlord on the share you do not own, and you usually pay monthly service charges as well⁴. You buy your share as a leaseholder, which means you have a lease rather than the freehold⁴.

You can fund your share in different ways. You might use savings or the equity from selling your current home to buy your share². If you do not have enough capital, you take out a mortgage on the share you buy. The scheme is aimed at people who cannot afford all of the deposit and mortgage payments for a home that meets their needs¹.

The scheme is available in England. In Northern Ireland there is a similar product called Co-Own for Over 55s, which is for anyone aged 55 and over using savings or equity from the sale of their current home⁶. In Scotland, the Open Market Shared Equity scheme is available to applicants aged 60 or over, and there is no requirement to take out a mortgage, but you must contribute as much as you can towards the purchase price⁷.

Who can apply and where homes are available

To buy an OPSO home you must be 55 or over, and at least one of several statements must also apply. You must be a first-time buyer, or you used to own a home but cannot afford to buy one now, or you are forming a new household, or you are an existing shared owner who wants to move, or you own a home and want to move but cannot afford to buy a new home that meets your needs¹.

If you already own a home, there is an extra step. When you buy an OPSO home, you must have formally accepted an offer for the sale of your current home, called sold subject to contract or STC, and you must have written confirmation of the sale agreed, called a memorandum of sale. The sale must complete on or before completion of the shared ownership purchase¹.

The scheme is not the same as the Right to Shared Ownership, which is available to tenants living in social and affordable rent homes funded by the new affordable homes programme⁸. A specialist home for older, disabled or vulnerable people is excluded from the Right to Shared Ownership⁴. If you have a long-term disability, there is a separate scheme called HOLD, which follows the same rules and has the same deposit range of 5% to 10% of the share you are buying⁹.

In Northern Ireland, Co-Own for Over 55s is for anyone aged 55 and over using savings or equity from the sale of their current home⁶. You can apply if you own a property and are selling it to fund your share of your new Co-Ownership home¹⁰. In Scotland, the Open Market Shared Equity scheme is for applicants aged 60 or over, and there is no requirement to take out a mortgage, but you must contribute as much as you can towards the purchase price⁷.

Monthly costs: mortgage, rent and service charge

Each month you usually pay a mortgage payment, rent and a service charge¹¹. The rent is paid to the housing provider on the share of the home it owns¹². The service charge covers things like cleaning shared areas and maintaining the building¹¹.

If you buy your share without a mortgage, using savings or equity, you do not have a mortgage payment, but you still pay rent on the share you do not own¹³. In Northern Ireland, Co-Own for Over 55s customers pay rent to Co-Ownership on its share plus all household bills and costs¹³. Co-Own customers pay a mortgage on the share they own to their mortgage lender, rent to Co-Ownership on the share it owns, plus all household bills and costs¹³.

Housing associations contribute up to £500 a year towards certain repairs and maintenance costs in the first 10 years of ownership⁸. This is a contribution towards certain costs, not a cap on all repairs, and the lease sets out what it says about repairs and major works.

Buying costs: deposit from 5% of your share, stamp duty and fees

You need a deposit, usually between 5% and 10% of the share you are buying¹. For example, if you buy a 50% share, the deposit is calculated on that 50%, not on the full value of the home. The same deposit range applies to the HOLD scheme and to the Right to Shared Ownership⁹.

You also pay stamp duty on your purchase. Stamp duty is based on the share you buy, and you may be able to pay it in stages as you staircase. Married couples are treated as a single unit for stamp duty purposes, so HMRC will treat you as if you are part of the same unit¹⁴. If a parent helps with the deposit and already owns a home, they must pay second property stamp duty rates¹⁵. Where a child would be treated as purchaser or holder of a dwelling interest under a settlement or bare trust, the parent and any relevant spouse or civil partner are treated as holding it instead¹⁶.

There are other buying costs too. You need a legal professional for conveyancing, and there may be fees for the lease, searches and surveys. In Northern Ireland, the Co-Ownership legal package only covers the purchase of your new home, not the sale of your current one¹⁷. The sale of any property you currently own is excluded from the legal package for those applying for Co-Own for Over 55s¹⁸.

Staircasing: buying more of your home over time

You can buy more shares in your home in future, which is known as staircasing. If you buy more shares, you will pay less rent¹. Staircasing is when you buy extra shares in your home over time, which increases the amount of the property you own and could help lower your rent payments¹⁹.

With Co-Ownership, you can increase your share, even up to full ownership, in steps or buy the provider out completely, with no fixed timeline²⁰. The scheme offers the opportunity over time to increase your share within the property and eventually own the property in full²¹. The Right to Shared Ownership also allows you to buy more shares in the future and pay less rent on the rest of the property⁴.

The key difference with OPSO is the rent-free threshold. Once you own 75% of the home you do not have to pay rent on the remaining 25% share of the property¹. So you do not need to reach 100% ownership to stop paying rent. If you staircase to 100%, you own your home completely and pay no rent at all¹³.

Selling, moving out and what you cannot do with the home

If you are no longer living in your home on a long-term basis, the property should be sold²². The sale value will be split between you, or your estate, and the provider in line with the equity share in your agreement²². This means you get back the value of your share, and the provider gets the value of its share.

Shared ownership properties are usually leasehold, meaning that shared owners are leaseholders²³. Shared ownership properties are always leasehold⁵. A shared ownership lease provides similar rights to an ordinary long residential lease but there are some differences²⁴. The lease sets out what a shared owner can and cannot do with the home.

You cannot simply rent out the home or a room in it as you would with a home you own outright. The scheme is designed for you to live in, and if you are no longer living there on a long-term basis, it should be sold²². If you are thinking about letting a room, check your lease and speak to your landlord first.

If you jointly owned your home and there is not enough money elsewhere in the estate to pay off the deceased person's debts, the home may have to be sold²⁵. If you are going through a divorce or dissolution, your options include selling the home and both moving out, one partner buying the other out, keeping the home without changing ownership, or transferring part of the property's value from one partner to the other²⁶. MoneyHelper has free guidance on dividing the family home during divorce or dissolution²⁶.

Can I get help with housing costs on benefits if I am a shared owner?

If you live in a shared ownership property, you could get Support for Mortgage Interest as well as help with your rent²⁷. Shared ownership means that you buy a share of your home through a shared ownership scheme but still pay rent, and you can get Housing Benefit during this time²⁸.

The rules on housing benefit and the shared accommodation rate are complex. A shared accommodation rate is paid to single Private Rented Sector claimants under the age of 35, and it does not apply to under 35s living in supported housing in the Private Rented Sector²⁷. There are exemptions, including if you are aged 18 to 24 and identified as a care leaver, an ex-offender posing a risk of serious harm to the public, formerly homeless aged 16 to 34 receiving resettlement support, or receiving Attendance Allowance, DLA care part middle or higher rate, or PIP daily living part due to disability²⁷.

You may be allowed an extra room for a severely disabled adult or child who needs their own room but would be expected to share under the rules²⁹. If you live in a shared house, the shared accommodation rate may apply³⁰. In Northern Ireland, there is a Lone Pensioner Allowance for tenants and homeowners aged 70 and over who live alone, with some exceptions for ratepayers who are carers, those providing care, households with under-18s or someone with severe mental impairment³¹.