The house is worth £275,000, my share is £165,000 and remaining on the mortgage is £120,000.
Am I reading this correctly, that you have £110,000 to pay off to reach 100% interest? What happens as the house value rises? In the end, does the association's nominal dollar value interest increase proportionately with house value, or is it fixed?
Assuming no changes and that you want to avoid prepayment penalties, this means it would take a minimum of 9 years to pay this off, and would take 33 years to pay off at your proposed £400/month. While you always need to start somewhere, going through this kind of commitment to get to a point where you can rent it does not excite me.
I think this is a case where you are just starting off, so "big" diversification is really just watering down your impact, rather than doing you a lot of good. Put it all in stocks for now; give your portfolio some time to grow, and your paycheck as well, and you can look at biting off your mortgage as a whole item once you have a good foundation.
Conversely, if your heart is in real estate and renting, you could concentrate there; if you found a way to accelerate your payoff, it might be worth taking the risk of a floating rate to get out from under the prepayment penalty cap.