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Hello Forumites! In order to help keep the Forum a useful, safe and friendly place for our users, discussions around non-MoneySaving matters are not permitted per the Forum rules. While we understand that mentioning house prices may sometimes be relevant to a user's specific MoneySaving situation, we ask that you please avoid veering into broad, general debates about the market, the economy and politics, as these can unfortunately lead to abusive or hateful behaviour. Threads that are found to have derailed into wider discussions may be removed. Users who repeatedly disregard this may have their Forum account banned. Please also avoid posting personally identifiable information, including links to your own online property listing which may reveal your address. Thank you for your understanding.Shared ownership/equity is a scam.
Comments
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Indeed as this article shows many schemes have failed those who fell for them. Those schemes tend to be where you are restricted to buying a new/purpose built property. You really do need to do a lot of research beforehand. To those considering shared equity see if there are any schemes in your area where you can purchase a share of a property not specifcally built for FTBs or key workers, an older/period property. This way you will have far fewer headaches.0
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and_another_thing... wrote: »Indeed as this article shows many schemes have failed those who fell for them. Those schemes tend to be where you are restricted to buying a new/purpose built property. You really do need to do a lot of research beforehand. To those considering shared equity see if there are any schemes in your area where you can purchase a share of a property not specifcally built for FTBs or key workers, an older/period property. This way you will have far fewer headaches.
So would you like to tell me how you are going to pay back the equity loan in 5-10 years? What happens if you are in negative equity when this comes around?
You have a Shared Equity Time Bomb round your neck.
:eek::exclamatiScams - Shared Equity, Shared Ownership, Newbuy, Firstbuy and Help to Buy.
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Guess they didn't bother reading the t&c's properly as I'm sure these details would have been listed. If they weren't in the t&c's then they could've taken them to court.0
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Wickedkitten wrote: »If the scheme didn't exist, they would have to lower the price to a level that people could afford or they wouldn't be able to sell them.
They would be able to claim Housing Benefit on a rented flat anyway and if someone had 16k, they wouldn't need Housing Benefit surely.A couple who got on the property ladder through a shared ownership scheme have dismissed the concept as a disaster.
The issues the family in the article above would have been the same if they had owned 100% of the flat or were just renting the whole flat. The general thing that I get from the article is they were unhappy with the management company doing nothing and that they were unable to sell but if they read the agreement they could have staircased to 100% then sold. This can be done on the day of sale so no actual money is required.
To pay only a £433 a month on effectively £116,000 of property is only about 4.5% per year and it's inclusive of repairs and maintenance to the structure so to me it seems quite cheap.:footie:
Regular savers earn 6% interest (HSBC, First Direct, M&S) Loans cost 2.9% per year (Nationwide) = FREE money.0 -
Shared ownership under spotlight
The Law Society says schemes offered by housebuilders to help first-time buyers could leave them unable to trade up when they come to sell. Shared equity deals are on the increase as developers try to shift thousands of homes in the property market slump.
Report Video link: http://news.bbc.co.uk/1/hi/business/7613781.stm
Sarah Pennells reports.:exclamatiScams - Shared Equity, Shared Ownership, Newbuy, Firstbuy and Help to Buy.
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The Law Society says schemes offered by housebuilders to help first-time buyers could leave them unable to trade up when they come to sell. Shared equity deals are on the increase as developers try to shift thousands of homes in the property market slump.
Report Video link: http://news.bbc.co.uk/1/hi/business/7613781.stm
Sarah Pennells reports.:footie:
Regular savers earn 6% interest (HSBC, First Direct, M&S) Loans cost 2.9% per year (Nationwide) = FREE money.0 -
and_another_thing... wrote: »Where I live (South West london) it has worked out cheaper to buy a share of equity in a two bed flat than to rent a decent one bed.
Will it still be cheaper than renting when the base rate goes up?It's not easy having a good time. Even smiling makes my face ache.0 -
brit1234 - The loan needs to be repaid after 25 years or when I sell. I don't intend to stay here for that long! I have a four years left of a five year fixed rate mortgage which will hopefully see me through. I also overpay on my mortgage each month but if I am in negative equity when I come to sell then I will be in the same position as everyone else owning 100% of their property when they, too, come to sell. I don't plan on remaining in this area after I sell as it is now and still will be far too expensive and I also plan to move further out of London anyway. Where I intend to move to I could now buy a property on my own, without the help of a shared equity scheme, but beacuse of work commitments at the moment I must live where I am.
Everyone has their own individual circumstances and in my case I believe SE works well for me at this moment in time and that it is the best way to pay for a roof over my head whilst working in London. It is not a permament solution and if I wasn't single but had a family it would not be something I would consider.0 -
Do some people actually think the government want to help FTBs with this new scheme that they have cooked up ?
If the government really did want to help a FTB put a roof over their head then they could quite easily release a piece of land in many areas big enough to build a large housing estate on and give (or sell at a fair price) each FTB a plot on that land to build their own homes, each ftb could then get their own construction firm to build them a house or do it themselves like a self build project. No major house building companys would be involved and the FTBs could quite easily end up with a decent 3 bed home for quite a bit under 100k.
The government couldnt care less about FTBs, and this is plainly obvious by FORCING them to buy a home from a major house building company if they want to be involved in the scheme.0 -
and_another_thing... wrote: »brit1234 - The loan needs to be repaid after 25 years or when I sell. I don't intend to stay here for that long! I have a four years left of a five year fixed rate mortgage which will hopefully see me through.
But your loan is interest free usually for 5 years after you purchase. So what is the interest rate on this loan after the 5 year period? Is the interest rate fixed or is it linked to BOE rates?
Now if you don't manage to sell within the 5 year peiod can you afford the mortgage and the loan repayments? What happens if you can't re-mortgage due to negative equity when the fixed rate ends.
These are the questions people considering this scheme need to know before you brag about how good it is.
:exclamatiScams - Shared Equity, Shared Ownership, Newbuy, Firstbuy and Help to Buy.
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