Staircasing is the term used when, as a shared owner leaseholder, you want to purchase further shares in the home when you can afford to. The greater the share you own, the less rent you will pay, until ultimately if you staircase to 100% you will pay no rent**
Details of the staircasing requirements will be set out in your lease. Leases do vary, for example: some leases allow you to staircase at any time, others may state in has to be 3 or 12 months since the start of your lease and you may want to discuss your lease with your legal representative.
It is entirely up to you whether or not you choose to staircase.
The benefits of staircasing
Many shared owners aspire to full home ownership which may have been one of the reasons you purchased shared ownership in the first place. The obvious benefit is that the higher the shares you own in your property, the lower the rent you pay. If you staircase out to 100% ownership, you will have no rent to pay.
Another benefit comes when you decide to sell your home – especially if the value of your home has increased. In this instance, the higher the percentage you own, the more profit you will make when you sell your property. This extra profit can be the deciding factor on whether or not you can afford to purchase a property on the open market, without further assistance.
If you have staircased out to 100%, you can sell your property on the open market, using an estate agent or internet agent etc.
Minimum and maximum shares
Unless it is a final staircasing to 100% ownership, the minimum extra share you can purchase is 10%, but this may be defined by your lease.
The maximum share you can purchase is 100% of your property**.
After the initial share purchase of a new build property, the various owners of the property may only staircase a (combined) further 3 times for full ownership between them.
It is important to note that each extra share bought is based on the ‘current market value’ at the time of application to staircase, not at the price of the property when you first purchased it. You will also incur valuation and legal fees etc each time you staircase.
** There are some exceptions to being able to staircase to 100%; for example your property has a ‘fixed equity’ lease as you purchased your property in a rural restriction or protected area or through a specific older person’s or disabled person's development. This will be defined in your lease but you should have been aware of this restriction when you first purchased your property.
Please click on the below document for more information on staircasing with Catalyst Housing Limited