What is staircasing?
Once you have bought the initial share of your Shared Ownership home, you can buy further shares. This process is known as staircasing.
Do I have to staircase?
No – it’s entirely up to you. Most people who live in Shared Ownership properties staircase to reduce the rent they are paying, but it's your choice.
When you come to sell your home, the greater percentage you own, the more profit you will make if the value of your home has increased.
This staircasing calculator will help you decide if you can afford to buy a greater share.
How do I staircase?
1. If you would like to buy further shares, please email our Residential Sales team at email@example.com and we’ll get the ball rolling by sending you a few documents, some of which you should return to us at the address given on the forms.
2. We’ll ask you to choose a surveyor from a list and whichever you pick will value your home to determine its current market value. (Each one we recommend will be registered with the RICS (Royal Institute of Chartered Surveyors).
You'll be responsible for the cost of the valuation at a cost of £180 + VAT. (A valuation given by an estate agent won't be enough).
3. The valuation is valid for three months, and if you don't buy the extra share of your home in this time, the property will have to be re-valued. This is usually at a reduced rate as the surveyor who carried out the original inspection won't need to revisit the property.
NB, If the value has increased in the meantime, it will be more expensive to buy your extra share.
4. Once your purchase has gone through, the amount of rent you pay will be adjusted accordingly. If you've taken out a mortgage to pay the share, you'll pay an increased amount to your lender from the day of completion.
How many times can I staircase?
You can usually staircase up to three times. The third time will take you up to 100% ownership. The minimum share you can purchase is specified in your lease but is usually 10% or 20% (unless it's the final share, which may be less than the minimum share in order for you to staircase up to 100%).
What about my mortgage?
You'll need to contact your mortgage lender if you're increasing your mortgage by staircasing. This additional amount is known as a “further advance”.
If you want to move your mortgage to a new lender, perhaps for a better interest rate, this is known as “re-mortgaging”.
Peabody can provide you with details of independent financial advisors who have knowledge of Shared Ownership and the lenders you can apply to, if required.
Do I need to speak to my solicitor?
Yes - you'll need a solicitor because the increase in your share will result in changes to your existing lease.
We can provide you with details of solicitors who have experience of the staircasing process.
What costs are involved?
Other costs involved in buying further shares in your home include valuation fees, legal fees, mortgage arrangement fees and stamp duty (if applicable).
There may also be further amounts charged by your mortgage lender.
Will I benefit from improvements I've made to the property?
If your improvements have added value to your home (not all improvements do), they won't be taken into account for the valuation.
That means the purchase price of your additional share won't include any increase in value caused by the works you have carried out.
What happens if I staircase to 100%?
Once you own 100% of your home, you'll no longer pay any rent to Peabody.
As you'll still be a leaseholder, however, you'll still have to pay your service charges as well as ground rent (if applicable).
The freehold of your home can be transferred to you when you have staircased to 100%, if you own a house rather than an apartment in a communal block. To have the freehold transferred you will need to contact Peabody requesting the freehold of the property be transferred to you.
You pay your legal costs for the transfer, but we won't charge a transfer fee.
Once the transfer has taken place, you will no longer have to pay the buildings insurance portion of your service charge (although you will have to take our your own buildings insurance policy).
However, you may still have to pay a service charge to Peabody if you live in a communal development and are responsible for some of the cost.
Can I sell my home?
If you own less than 100% of your home, Peabody can nominate prospective buyers and restrict the sale price to the valuation given by a valuer nominated by us.
However, once you own 100% you'll be free to sell your home on the open market. We can sell your property for you and will charge competitive fees compared to many high street estate agents.
For more information on selling your home, see How to sell my Shared Ownership home in the Shared Ownership FAQS (link)
Is there any reason why I wouldn't be able to staircase?
Not unless you're in service charge or rent arrears or it's specifically mentioned in your lease that you can't (because of a time restriction, for example).
I have a question that isn't answered above
Feel free to contact our sales team on 020 7021 4496 or email us at firstname.lastname@example.org and we'll be happy to help you.