Jan 23

Alternative ways to get your own home

Reading Time: 11 mins

You want to get your own home and you’re working hard to save up the money, but still it seems completely out of your range.

What do you do?

Well, there are some alternatives to look at, including some actual Government and charity help that you could use.

Here are some ideas.


First off, there are some great government schemes that could give you a financial leg-up to help you buy your home.


Help to Buy schemes

Help to buy equity loans

This scheme will support people who have at least a 5% deposit, allowing you to purchase a new-build home worth up to £600,000.

Essentially, the Government lends you up to 20% of the cost of your newly built home, so you’ll only need a 5% cash deposit and a 75% mortgage to make up the rest. This means that you can get a mortgage that has a low interest rate. The 95% mortgages tend to be more expensive because the lenders are taking more of a risk.

You won’t be charged loan fees on the 20% loan for the first five years of owning your home.


equity loans – the rules

  • New build only
  • You’ll need a minimum 5% deposit to qualify
  • This expands the existing First Buy scheme and is now available to all, not just first-time buyers
  • The government will lend you up to 20% of the value of your property through an equity loan, which can be repaid at any time or on the sale of your home
  • You’ll only need to secure up to a 75% mortgage from a bank or building society

Find out more on the Government website here/

Check out our mortgage comparison for the cheapest loans on offer.


help to buy shared ownership

Help to Buy: Shared Ownership offers you the chance to buy a share of your home (you can buy between 25% and 75% of the value) and then pay rent on what’s left. Later on, you could buy bigger shares if you can afford to.

To qualify for this you must:

  • 2 sets of hands holding a model housebe earning £80,000 a year or less if you’re outside London (that’s for the whole household)
  • earn £90,000 a year or less in London (per household)
  • be a first-time buyer
  • or you used to own a home but can’t afford to buy one now
  • or be an existing shared owner looking to move

With Help to Buy Shared Ownership you can

  • either buy a new-build home
  • or an existing one through resale programmes from housing associations.

The properties will always be ‘leasehold’ while they are shared ownership.

You can take out a mortgage to pay for your share of the home’s purchase price, or fund this through your savings.


People with disabilities

Home Ownership for People with Long-Term Disabilities (HOLD) can help you buy any home that’s for sale on a Shared Ownership basis if you have a long-term disability.

You can only apply for HOLD if the properties available through the other home ownership schemes don’t meet your needs, eg you need a ground-floor property.


Older people and help to buy shared ownership

There is something called ‘Older People’s Shared Ownership’ which you can apply for if you’re 55 or over. It works in the same way as the Help To Buy Shared Ownership scheme, but you can only buy up to 75% of your home.

However you won’t have to pay rent on the remaining share once you’ve bought your section.


how to apply for a Help to Buy Shared Ownership scheme

To buy a home through a Help to Buy: Shared Ownership scheme you need to contact the Help to Buy agent in the area you want to live. They will talk you through your options and help you with the process.

Find out more at the Government website here


Shared ownership with housing associations

This is where you buy a share of your home and pay a small rent on the rest, usually sharing ownership of the property with a local authority or housing association.  You pay rent to the landlord for part of the property and a mortgage on the rest. You’ll usually be able to buy further shares in the property at a later date.

  • To qualify for the scheme you’ll have to be a first-time buyer.
  • Priority is given to local authority or housing association tenants but other people in housing need may also be considered for the scheme so it’s worth a try!

Hand holding keys with house keyring

This scheme does have a few downsides apart from eligibility.

  • Firstly, it’s only for newly-built houses.
  • Also, you have to sign up to a housing association, which may have an extremely long waiting list.
  • And you’ll still need enough money for the mortgage and deposit on the share you’re buying.

You can find a list of housing associations here.

More information about shared ownership is available from the Homes and Communities Agency, local authorities or housing associations.

If you’re aged 55 or over, you can get help from another scheme called ‘Older People’s Shared Ownership’. This works in the same way as the shared ownership scheme, but you can only buy up to 75% of your home. Once you own 75% though, you won’t have to pay rent on the remaining share. Happy days! For more information, look at the GOV.UK website.

The homes charity Shelter has some useful information here too.


Buying your council house with Right to Buy

If you’re a tenant of a council property then you may well be entitled to get your own homebecome the owner of your home.

Since the 80s many people have been buying up their homes and successfully being part of the property ladder.

What’s more, these houses are being sold at a friendly discount! The size of the discount will vary according to how much the house is worth, where you live and how long you’ve been a tenant.

However, you do have to be careful.

  • Some council properties, particularly those in large, poorly-maintained blocks, may be very difficult to re-sell and won’t hold their value.
  • You might also find it hard getting a mortgage on certain properties as well as having to pay a large amount to get things fixed up.
  • But these discounted prices may be up to 70% so it could well be worth it!

Find out more on how you could buy your council house with Right to Buy here.


Buying with a friend/lover

Two wages are better than one, especially if you’re looking to get a fairly large mortgage, but when you bring money into the equation with a friend or lover it can lead to problems.

  • Young couple unpacking moving boxesMake sure you’re very open and frank with each other when working out the logistics of this.
  • You need to make sure you can both fund the venture and are both planning to be in on it for an agreed amount of time.
  • Obviously you need to know you can stand living with them day in, day out.
  • But even if they’re wonderful, you should get things set out clearly by a legal expert first to protect you both in a legally binding document like a declaration of trust or co-habitation agreement.

According to the law, you can own a house with someone else either as joint tenants or as tenants-in-common and it’s a very important distinction.


Joint owners

Two people simply own the whole house between them. There’s no fancy word or process to describe this. If one of the owners dies, the other automatically becomes the full owner of the house and no will written by the friend and co-owner giving it to his family can change that. This is a common type of ownership between married couples.



You both own half of the house (or a different percentage depending on what you agree). If one of you wishes to leave your share to someone else, you can do that.

Your partner can’t just sell the house and get all the money. It has to be divided up according to the percentages, so if you’re co-habiting, or are just friends trying to save money by living together, this protects you both. If one wants out the other owner will have the option of buying up their share of the property too.

Co-habitation will certainly save you money.

You’ll be sharing the deposit, household bills, maintenance costs, transaction fees and mortgage repayments. However, whatever you do, don’t rush into this.

For a joint application on a mortgage you are both jointly liable. If one person defaults then the lender will be chasing you both, and both of your credit ratings will be affected. Make sure you really trust the person you buy the place with.

Do remember, too, that if you take out a mortgage with someone else, your credit history will be linked to theirs so make sure they have a good credit record before jumping in. Check for free with CreditExpert here.

Would you like a home for free?? Find out here how you could do that today!



At auctions they have hard-to-sell properties at lower prices.

If you know what you’re doing (and particularly if you’re good at building) you can pick up a real bargain here. But there are problems, or at least some things to consider:

  • Getting a mortgage for a run down place will be difficult so be ready to pay cash for it up front.
  • For other properties that can be mortgaged you’ll need to have at least a 10% deposit ready to put down on auction day. The rest has to be paid within 28 days so it’s best to have a mortgage sorted out beforehand.get your own home
  • You will of course have to view the property in person before you bid on it. Have a good look round for any potential problems or changes you’d want to make to suit your own needs. Don’t forget to look at the surrounding area too.
  • Each property is released about three or four weeks before auction day so arrange a viewing as soon as you can.
  • You should get the property professionally inspected before you bid on it, which could set you back a few quid.
  • The vast majority of the properties won’t be modernised and will need refurbishment, so remember to factor that in when calculating all the costs.
  • It’s easy to get carried away with the excitement of the auction and you may end up bidding for the wrong property. Once you’ve won your bid it’s as if you have signed a contract – there’s no going back!
  • There is a minimum price for each property. The good news is that sometimes you might be the only one bidding, in which case you’ll get it for that minimum price. However, there could be up to around 30 buyers, so remember the point where you have to stop bidding!
  • Remember you’ll probably be competing against professional property developers so you’ll need nerves of steel!
  • You could end up with a complete lemon. So make sure if you go in for this you have confidently assessed your financial situation and taken into account any extra costs.

For more information on how to buy at auction, look at the EI Group website. If you’re really serious about buying at auction it’s worth joining their mailing list for information about upcoming sales.


Building your own home

Plans for building a houseOver 25,000 people build their own home each year. It may seem a bit extreme, especially if you have little experience in this field, but you don’t have to be a builder yourself. Just be willing to look for land, bring in an architect and have the patience to project-manage the works while the house is being built (probably 12-18 months).

A well-run self-build project should see the final value of the home increase by 20-30% on the actual building and land costs once it’s finished. So, if you’re prepared to wait and do the work, you can make some sensible money on it.

For more information on how to go about building your own home check out Build It, Ebuild and Homebuilding & Renovating.

Alternatively, make it easier for yourself and get a flat-pack home! These are increasingly popular and there are now lots of designs to choose from. There’s still a lot of building involved but much of the work is done for you. The kit home – where a major part of the house itself is made in a factory somewhere – is just another example of the prefab building, but rather nicer and more solid. There are all sorts of companies around the world making kits in different materials (timber, obviously, but also metal structures and some using former freight containers!), and it’s worth spending some time researching what’s out there.get your own home

For any type of self-build remember that you’ll have to buy land as well! Land auctions are a great way of obtaining a plot at competitive prices. You could also look into council land as local authorities are always looking for ways to make money. There are some good websites for finding cheap land, such as the Land Registry and Plotfinder.

  • Beware of companies trying to sell you land without planning permission in the hope that they’ll get it later on.
  • Make sure you’ve checked out your self-build company online and in magazines first. Some can be rather dodgy.
  • Find a good builder from word of mouth and sites such as MyBuilder and Find a Builder. Get three quotes and ask for a few references from each builder.
  • Choose your architect carefully – they should have a good appreciation of budget as well as artistic talents.


buying with the bank of Mum and Dad

If your parents have cash to spare they could help in a couple of ways.

They could be a guarantor for a large mortgage or they could actually buy the property as an investment.


Guarantor mortgages

With a Guarantor mortgage, your parents, or grandparents, or other close family member, could put themselves up as a ‘guarantor’ for your loan. That way, if you defaulted on the loan, the mortgage company could hit your guarantor for the payments.

Happy Family in front of homeNormally, the family member who is guaranteeing the mortgage offers their own property as collateral against the new property. So this means that if you don’t pay, they could potentially lose their home to cover the debt. However, there are guarantor mortgages around now that limit the amount the guarantor is liable for which could be better for many families.

Of course, if no repayments are missed, it won’t cost the guarantor a thing.

You can sort this out through a normal high-street lender, who will look at your parents’ income and assess taking into account whether they’ve got a large mortgage of their own and can really afford your payments as well.

Some companies might allow you to take out a mortgage if the amount of money you have isn’t a million miles away from what’s needed. But there’s no guarantee.

Check out our mortgage comparison for the cheapest loans on offer including Guarantor Mortgages.


family offset mortgage

family using a laptopOffset mortgages can be a handy way to pay off your loan quickly as we show in this article.

With a family offset mortgage – which is offered by a few lenders – parents or grandparents put their savings into an account  that is linked to their child’s mortgage.

The money in the savings account is then offset against the mortgage, making the child’s repayments lower.

Parents and grandparents will ultimately be able to get their money back in full, but they may have to lock it away until the mortgage has been paid off to between 75% and 80% of the property’s value, which could take twenty years or more.


family deposit mortgage

several pairs of hands holding a house modelWith this one, a family member (or members) deposits cash in a special savings account and the money is held as security against the mortgage. Again, a sort of ‘guarantor mortgage’.

The cash is held for a fixed period of time and if the mortgage borrower defaults the money will be taken from the family member’s savings account.

The benefit here is that the family member still gets interest paid on the money linked to the mortgage, although the rate might not be particularly good. And if the borrower meets all their repayments, it won’t have cost the family anything.


parents Buy the property as an investment

Glass piggy bank with model house insideAlternatively, your parents could buy the property for you and get their share of the money back when you sell it.

Some parents like to do that for student offspring so that when the student graduates and moves out of that town, the parent sells it and, hopefully, makes a profit.

Of course, you wouldn’t benefit from this, unless you did a deal where you paid them ‘rent’ while you were there, gradually buying a portion of the house each month.


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