IS buying half a house better than buying no house at all? With property prices in many places way out of reach of first-time buyers, shared ownership is being promoted as the saviour for aspirational home owners. But is it a good investment?

Does getting a mortgage on a place and then paying rent as well stack up as a long term bet? Well, buyers down in Stockport obviously think so.

In the Textilis scheme, close to the town centre, half the 22 apartments were offered on shared ownership and the other half sold on the open market by the developer Seddons.

The full-sale properties are slightly higher specification with en-suites but only a couple have been sold compared to 10 of the shared ownership units.

Paul Philbin, sales manager with Irwell Valley Housing Association, which is marketing Textilis, said: "It is a good example of the strength of demand from buyers for shared ownership and shows that there is the demand if the price is right.

"Most have bought a 50 per cent share in an apartment priced at é140,000, which takes them affordable to a much wider local market." He has seen similar demand at other IV developments across the region, with a scheme at Bradshawgate in Bolton attracting 230 inquiries, even though it will not be ready until August.

Even though the government is pledging more money to help first-time buyers the number of shared ownership properties available across the region is a tiny fraction of the housing market.

Schemes

With 17 different social landlords all providing different schemes, keeping a tally on just how many is not easy and they vary from four and five-bed family houses in Oldham down to studios in Salford. The cheapest shared ownership option currently around is é15,624 for a 12.5 per cent share of a one-bed apartment at Pall Mall House in the Northern Quarter.

The biggest provider is Didsbury-based Plumblife, who have helped re-invent social housing by linking up with high-profile developers like Urban Splash and Countryside Properties.

Deputy chief executive Matthew Harrison who is also in charge of development said: "There have been a lot of rule changes and different initiative recently but people are realising that this is actually a good way to get onto the property ladder.

"Even with the current flexible borrowing criteria, people on low incomes can often not borrow enough to afford a house in the place they want to live.

"What shared ownership does is give you the opportunity to buy a share and buy more as and when you can afford it.

"The rental element is subsidised by the government and will always be less than paying a mortgage on the full price of the property." And the recent rise in interest rates may have dismayed other home owners but are making shared ownership deals more attractive.

Philbin explained: "Our rental element is based on 2.7 per cent of the property's total value. If you had a mortgage on that portion you would currently be paying 5 per cent interest so it actually helps buyers.

"With interest rates likely to go up again I expect more people to be buying just a 50 per cent share so the rental element makes it cheaper."

Almost two years ago, Amokrane Bennoussaid bought a 50 per cent share of a new build two-bedroom terraced house in Levenshulme through Plumblife, and has just completed the paperwork to buy the other half

He said: "The house was valued at é112,000 and I got a mortgage for é56,000. But I have changed jobs, my salary has increased slightly and I also now have a wife and young son so wanted to be able to own it all.

"The house is now worth é120,000 so I have had to pay é60,000 for the other half and it will be a bit of a struggle but the longer you leave it the harder it will be.

Increase

"If I had not been able to buy just a half share in 2005 and tried to buy a property now I would have been even further away. As it is my monthly payments will increase by about é200.

"I could just have bought another 25 per cent but each time you buy another chunk it is treated as a new purchase and I have had to pay legal fees of é1,000 for solicitor's searches and bank administration fees so it made sense to buy the full 50 per cent.

"For me, and now my family, it has been a good way to get on the ladder and a much better option than renting.

"I still don't think enough people know about shared ownership and the type of properties available."

Lawrence Copeland is a city agent who has been selling on people's shared ownership properties for the last five years or so, and he said: "The ones that sell best are the ones on properties with values of between é120,000 to é130,000. Anything more than that is more difficult. "But, if people take a long-term view and staircase to own a bigger share as soon as they can then it is a good way to get started and build up equity."

More information:

Plumlife on 0161 447 5050 or plumlife.co.uk

Irwell Valley Housing Association - 0161 610 1000 irwellvalleyha.co.uk

Contour Housing - 0845 602 1120 contourhousing.co.uk

Harvest Housing: harvesthousing.org

Asset Trust Housing 0845 373 2424 pallmallhouse.tv

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