Understanding Shared Home Ownership in Western Australia (WA): A Pathway to Affordable Home Ownership

For many Western Australians, the dream of homeownership can feel distant due to high property prices and the difficulty of saving for a large deposit. The Western Australian Government’s Shared Home Ownership scheme, also known as SharedStart, offers an accessible solution by reducing upfront costs and opening the door to homeownership for low- to moderate-income earners. This article provides an overview of the Shared Home Ownership program, its benefits, eligibility criteria, and application process.

What is Shared Home Ownership?

Shared Home Ownership, or SharedStart, is a government-backed initiative aimed at making homeownership more affordable for people who might otherwise struggle to secure a traditional mortgage. Under the program, eligible buyers can co-own a property with the WA Department of Communities, which retains a percentage share of the property. Buyers can purchase a portion of the property (typically 70–80%) at a reduced cost while the government covers the remaining share, easing the financial burden of buying a home.

Key Benefits of Shared Home Ownership

1. Lower Purchase Price: By co-owning the property with the government, buyers only need to pay for a portion of the home’s value, reducing the upfront purchase price and the amount required for a deposit.

2. Reduced Loan Amount: Since buyers purchase only part of the property, they need a smaller loan than they would for full ownership. This makes loan repayments more manageable and reduces financial strain.

3. Future Buy-Out Option: Buyers have the option to purchase the government’s share over time, allowing them to eventually own the property outright. This flexibility is especially valuable for those who may want to gradually increase their ownership stake as their financial situation improves.

4. Keystart Financing: The scheme is financed through Keystart, WA’s low-deposit lender, which offers low-deposit loans and does not require Lender’s Mortgage Insurance (LMI). Keystart’s low-deposit loans further reduce barriers for first-time buyers and those with limited savings.

Eligibility Criteria for Shared Home Ownership

To qualify for the Shared Home Ownership scheme, applicants must meet specific eligibility requirements set by the Department of Communities:

1. Income and Asset Limits: Buyers must fall within the program’s income and asset caps. The limits vary depending on household size and location.

   • Metro & Regional Area:

     • Single: $113,000

     • Two-person household: $174,000

     • Family: $174,000

   • Kimberley & Pilbara Area:

     • Single: $110,000

     • Two-person household: $110,000

     • Family: $110,000

2. Residency: Applicants must be Australian citizens or permanent residents living in Western Australia.

3. First-Home Buyer or Limited Ownership: While the program is primarily aimed at first-home buyers, it is also open to people who do not currently own a property. Some exceptions may apply based on personal circumstances.

4. Property Price Limits: The Shared Home Ownership program has price limits on eligible properties, with specific caps based on property type and location. Properties are typically selected by the Department of Communities, and buyers are encouraged to explore available options on Keystart’s website.

5. Owner-Occupancy Requirement: The property must be the buyer’s primary residence, as the scheme is intended to provide housing for owner-occupiers rather than investors.

How Does Shared Ownership Work?

1. Initial Purchase: Under the SharedStart program, the WA Government retains an equity share, usually between 20–30% of the property, depending on the buyer’s financial situation. The buyer only pays for the remaining share, reducing their loan amount and monthly mortgage repayments.

2. Shared Equity Arrangement: The government’s share is held as equity in the property, meaning they retain ownership over that portion until the buyer decides to purchase it back. This equity portion is interest-free and does not accumulate additional costs.

3. Buying Out the Government’s Share: Buyers have the option to buy out the government’s equity share at any time, gradually increasing their ownership in the property. This can be done in full or through smaller, staged purchases over time, offering financial flexibility.

Steps to Apply for Shared Home Ownership

If you’re interested in applying for the Shared Home Ownership scheme, here’s an outline of the process:

1. Check Eligibility: Review the eligibility criteria on Keystart’s website or consult with a Keystart loan consultant to ensure you meet all requirements.

2. Browse Eligible Properties: Eligible properties are pre-selected by the Department of Communities and listed on Keystart’s website. These properties are typically new homes or newly built developments located in various areas across WA.

3. Apply for a Keystart Loan: Applicants for the Shared Home Ownership program must apply for a home loan through Keystart. Keystart’s low-deposit loans (minimum 2%) and lack of LMI fees make the process even more accessible.

4. Purchase and Settlement: Once approved, you’ll proceed with the standard home-buying process, securing the property and signing the relevant agreements with the Department of Communities regarding shared equity ownership.

5. Optional Buy-Out: Over time, you can purchase the government’s share, transitioning to full ownership when you’re financially ready.

The Shared Home Ownership (SharedStart) scheme offers an innovative solution for Western Australians who may not have enough savings for a traditional home loan. By allowing buyers to purchase a share of a property and providing a future buy-out option, the WA Government is making homeownership more achievable for a broader range of people. With lower deposit requirements, reduced borrowing amounts, and flexible equity purchase options, Shared Home Ownership is an excellent choice for many first-home buyers and those with modest incomes.