Share your shared ownership experiences

MSE_Jenny · 26 May 2015 at 4:40PM

For those who can't afford to buy a home outright and are eligible, shared ownership can be an option. This is where you buy a share of the property and rent the remainder. If you've done it, we'd love to hear your experiences.

How easy was it to move up to full ownership, did you have problems selling it on and is there anything you wish you'd known?

If you haven’t already, join the forum to reply!

[threadbanner]box[/threadbanner]

ThriftyMummySam · 26 May 2015 at 10:54PM

If your thinking of a shared ownership DONT DO IT!!!!!! I really can't emphasise that enough. My husband and I moved into a 50/50 shared ownership flat which is obviously leasehold which added to the problems. At the time it seemed like a great idea to get on the property ladder in our first home. When we first moved in late 2005 we were paying roughly £340 mortgage and £200 rent every month, however, every year our rent increased so that when we left 7 years later we were paying £360 in rent as well as the £340 mortgage - we could have rented a flat for £500 a month in the area we lived in. You may thing well at least your gaining equity - WRONG - we put down a deposit of £6000 when we moved in and when we sold up the equity in the flat that we gained was £6500. Forgetting the money side when you only own a portion there are limits as to what you can and can not do in your home as their is when you are renting and have a landlord. Yet at the same time if there was a problem, like the boiler going bust, it is not the landlords problem it is yours to sort and pay for. Then there is the sale factor - ours was a nightmare to sell. It spent 2 years on the market before we got a buyer which is bad in itself but due to the complicated sale it took 9 months for the sale to go through and this was without a chain!! I could go on about it all day but I don't want to bore you!! I will say though that going into a shared ownership property was the worst financial decision my husband and I have ever made! We were young at the time and my advice would be to go and see a mortgage advisor and see what they can offer as it may be more then you think you can get. We are now in 3 bed house and our mortgage payments are £444 per month so we are already saving more then we were in the flat!!

countessv · 27 May 2015 at 7:24AM

We love our shared ownership. There has been some teething problems with the housing company who owns the rest of the house and their finance department. But nothing that would ever put me off recommending this. I bought 25% of a 2 bed house when I was a single parent and working in an expensive area that I couldn't have afforded otherwise to get my kids into a school with fantastic results. I first tried santander for the mortgage, I was left in tears and almost lost the sale of the house ( they later compensated me a measly £75 for their errors) . Step up hbos. As I have been a long standing customer they whisked me into a room, sorted it all out with only £6k deposit and saved the sale by completing everything in 7 days. I inherited a little sum a year later and bought another 25% of the house as a cash purchase. We currently own half the house with a mortgage of £110 per month which is now out of its fixed interest rate so we over pay and hope clear in 5 year. The rent and service charge costs are £163 per month. About the same as the interest on buying the rest of the house. But until I finish my degree and go full time I cannot afford repayment and interest ( about £400). I got married after buying and house is staying in my name For the moment. I cannot deny we have huge ararguments with the sharing owner over who does what. but we simply couldn't afford this area without this. Rent on 2 bed in this area is £600 a month minimum. rising to £800 easy. Our current mortgage and rent total is £273. It's a no brainier.

HHarry · 27 May 2015 at 7:56AM

My only experience of shared ownership is trying to sell a deceased relatives flat. It was a nightmare.

The Housing Association dictated all of the terms of sale; we were liable for all of the costs (The final bill to sell a £125k flat was £20k), and they were certainly in no hurry to complete the process.

ethank · 27 May 2015 at 8:12AM

Why own half of something if you can buy something that is fully yours. Shared Ownership is a great leg up, but you need to demonstrate housing need in order to get it. For instance it will be difficult for two adults to secure a 3 bed home they can grow into if there are families that need that 3 bed in the queue before them.

onemorehorse · 27 May 2015 at 8:52AM

Best thing I ever did! After a few years we were able to buy out the remaining share so the property is now ours (and the banks). The only downside to this was that we had to take out a new mortgage to buy out the remaining share rather than top up the existing mortgage, which then adds fees etc. I recommended this scheme to others who didn't do it and they are still renting, we have about 8 years until we are mortgage free. You can make improvements to the property and that would be taken in to account when having it valued for selling or staircasing but we chose to only make improvements after buying out.
We would not have afforded to buy a property as we did not have enough for a deposit. Depending on your local council you do not need to demonstrate housing need, we were able to buy on the open market.
I could not recommend shared ownership highly enough! I would agree though that the sale can take time to go through so would recommend solicitors experienced in shared ownership sales.

SailorSam · 27 May 2015 at 9:00AM

My house is much to big for me and i've thought about selling up and buying a flat. I've seen one i like less than a mile away and got in touch witth the Estate Agfent, but the thing that put me off is i'd only be buying 50%.

missmisty · 27 May 2015 at 10:10AM

Shared ownership was the only way I could have bought a flat on my own in London. I own 50% and the rent increases have been minimal over the last 4 years. I'm paying a total of £800/month inc. bills whereas renting a similar flat in the same area would cost over £1200/month. Staircasing is an option but I feel keeping it at 50% will help some other first-time buyer when I want to move on.

Having rented in London for over 6 years previously, it was also a real relief to finally have a landlord that didn't feel like they were trying to squeeze every penny out of me. The housing association I'm with are genuinely lovely people.

The buying process was a breeze as I used a solicitor who had worked on the sales of a lot of the other flats in the same building - the housing association had a list of solicitors they commonly worked with.

One thing to be aware of is that most of the mortgage deals you see advertised are not available for shared ownership - you will need to use a mortgage broker such as MSE-recommended London & Country.

Buying my own place is one of the best things I've ever done and in London, shared ownership was the only way I could have bought something half decent.

djembe_caz · 27 May 2015 at 10:42AM

There are different types of shared ownership. I'm on the LIFT scheme in Scotland where the government own about 20% of my flat but I don't pay rent on it. I just give them that proportion back when I sell or in 20 years. Or you can buy them out sooner in chunks (you have to pay solicitor fees and revaluation cost).

You could choose any property on the open market and could have one with a spare room as long as it was within their (fairly modest) limits. You did have to put up a deposit but only very small.

It's meant I was able to get on the property ladder and pay an affordable mortgage without being at the mercy of rent rises. I've had no issues so far and still feel grateful to have my own place.

I understand the latest schemes are not so flexible but would still recommend to someone struggling to come up with the vast deposits required.

aileth · 27 May 2015 at 11:07AM

It was great for us. We haven't staircased yet as we aren't sure if we're going to stay (nothing to do with SO, more to do with the area). Our next door neighbour sold theirs within six months.

Our HA is very flexible, we're allowed to do pretty much anything like it's our own home, and as far as re-selling is concerned, the only rule they set is that after we've found a buyer they need to vet them re finances, which are pretty open as it is, can't earn over 65k combined and no savings over 30k iirc.

We've lived in the house for four years now and the rent has gone up £10 a month.

auburnette · 27 May 2015 at 11:17AM

aileth, how did you find getting the mortgage? Did you use a broker?

PLEASE READ BEFORE POSTING

Share your shared ownership experiences

Comments

Categories

Get our FREE Weekly email full of deals & guides - and it’s spam-free