Dwell Well Moving Types of Property Ownership - How to Buy a house in the UK

Types of Property Ownership - How to Buy a house in the UK

5 types of property ownership - but which is best for you?

With so much focus on property purchasing, it can be difficult to know which property-owning option is most suited to your needs. There are a range of different options available, some of which have more restrictions than others. It’s well worth considering the different paths available to ensure you choose the ownership plan that’s right for you.

Here are five types of property ownership available on the current market:

Sole proprietor

Sole proprietorship is the simplest home ownership form, where only one person owns the home, generally through a traditional mortgage, as the sole buyer. For some, a joint borrower sole proprietor mortgage could also be an option. A joint borrower sole proprietor mortgage allows a second party, usually a parent, to help their child purchase a home by joining their mortgage, whilst not featuring on the title deeds for owning the property.

Joint Tenants

The most popular method of co-ownership, most readily used with those that are married or in civil partnerships, is that of joint tenancy through traditional mortgage. If the property is held as joint tenants, both registered owners will own the whole of the property together, and there will be no separate shares.

Shared Ownership

A shared ownership scheme is a cross between buying and renting, suitable in the first instance for those that are first time buyers. Buyers are given the opportunity to purchase between a quarter and three quarters of a property, and then pay rent on the remaining share of the property. The scheme is focused predominantly on those that are unable to purchase a home outright due to deposit demands and gives buyers the chance to get onto the property ladder at a fraction of the cost.

Tenants in Common

Tenants in common gives owners the opportunity to co-own a property, with each co-owner owning a specific share. Whilst this is typically a 50% share each, it is possible to hold unequal shares. This kind of property ownership agreement is ideal for people who wish to own a property jointly but wish to leave their shares of the property to a child or close relative when they pass away.

Help to Buy

Help to Buy is a government scheme designed to support anyone struggling to save a deposit for their first home, or those trying and struggling to move up the property ladder as they have limited equity. Under the help to buy scheme, buyers are only required to raise 5% of the property value as a deposit, and the government will cover up to a further 20%, meaning a mortgage at a maximum rate of 75%, which may well be much more accessible to a lot of buyers.