Diminishing Musharaka • Real Numbers
Model a Real Deal
See exactly how the Declining Partnership works — month by month, pound by pound. No estimates. No approximations.
Deal Parameters
£250,000
10% (£25,000)
2.5% p.a.
£500/mo
3.0% p.a.
10 years
Community Co-Invests
£225,000
Community Owns
90%
Total Rent Over Period
£56,258
Equity Bought Back
£60,000
| Year | Community Share | Property Value | Annual Rent Paid | Equity Bought | Dividend / £10k |
|---|---|---|---|---|---|
| Y1 | 90.0% → 87.6% | £250,000 | £5,556 | £6,000 | £247 |
| Y2 | 87.6% → 85.3% | £257,500 | £5,571 | £6,000 | £248 |
| Y3 | 85.3% → 83.0% | £265,225 | £5,585 | £6,000 | £248 |
| Y4 | 83.0% → 80.8% | £273,182 | £5,600 | £6,000 | £249 |
| Y5 | 80.8% → 78.7% | £281,377 | £5,616 | £6,000 | £250 |
Rent Decreases Monthly
As the homeowner buys equity, the community owns less. Each month the rent calculation shrinks — automatically and transparently.
Shared Risk, Shared Gain
If house prices rise, the community's equity increases. If they fall, the community shares that loss — not just the homeowner. This is what makes it Rent, not Interest.
FCA MCOB 14 Compliant
The Home Purchase Plan framework regulates this model. Every payment is a rental charge on the community's share — never a debt repayment.