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Equity sharing

Tenants of the Northern Ireland Housing Executive (NIHE) or registered housing associations, the social landlords, may choose to buy part of their dwelling if it is not financially possible to buy the property in full. This is known as equity sharing.

How does equity sharing work?

This is not a separate scheme, but part of the overall House Sales process, subject to the same rules as buying all of the dwelling from the NIHE or housing association. When you apply to buy the property, it is assumed that you will buy the full equity.

If you cannot afford to buy the entire property at the time, you can apply to buy as much of it as you can reasonably afford – the minimum amount is 25 per cent. You can increase your share at any time, which is known as staircasing. When you have purchased part of the property, you will cease to be the tenant and become the leaseholder.

If you are buying a Housing Association property, you will need to provide independent financial evidence showing the maximum equity that you can afford.

If other family members wish to buy the property jointly with the tenant, joint finances will be taken into account to determine what can be afforded.

You can find more information in the NIHE website, or by contacting NIHE or your housing association:

Discount

You will still be entitled to discount based on the proportion of the property you buy. This will be awarded at the maximum discount available to the tenant or the scheme maximum of £24,000, whichever is the lesser.

Discount can only be awarded to tenants and not leaseholders.

Leaseholder responsibilities

Rent

The rent to be paid by the leaseholder will be reduced and calculated on the amount of equity retained by the landlord. There will also be a reduction in rent to cover maintenance of the property. This maintenance reduction will be agreed at the initial purchase stage and will remain the same while the leaseholder is liable for rent.

Rates

The leaseholder is responsible for full rates as assessed annually by Land & Property Services (LPS). They should pay rates directly to LPS as the landlord will not be collecting rates on their behalf.

Service charges

In the case of sales of flats or maisonettes, the purchaser or leaseholder will have to pay an annual service charge in addition to the purchase price.

Maintenance and repairs

Maintenance and repairs are the responsibility of the leaseholder, regardless of the amount of equity purchased.

If you want more information on the House Sales Scheme including Equity Sharing you should contact NIHE or your housing assocation:

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