Shared ownership: question on revaluing the un-owned share?

Timmne

Hi all,

I have a shared ownership property, bought in 2005 for £127k, with my wife and I owning 40% of it.

When we moved in, we paid 2% of the unowned share (£76,200) for the first year in rent. This rent figure increases each year by the RPI in November preceeding the rent review, plus 2%. This year, the rent has increased by 5% (3% RPI plus 2%).

I'm wondering whether there is any way of me getting the apartment revalued in an attempt to reduce the amount of rent we pay, as the value of the place has reduced. It's particularly irritating to have a rent increase whatever the weather - even if there is no inflation (going by RPI), we will have a 2% increase.

Does anyone know if this is possible?

Thanks

Richard_Webster

It will depend on the precise wording of the shared ownership lease.

I hadn't understood that the rent was necessarily related directly to the value of the unpurchased share, rather that the Housing Association or other Landlord set a rent for the 100% share which was comparable to other rents for similar properties and then you paid 60% of that figure. The SO leases I have seen simply quote a starting rent for the whole 100% of say £3,000 pa and then if you are "renting" 60% that means that you pay £1,800 which they then increase by 2% over RPI each year.

If you were told that the starting rent was actually 2% of the £76,200 then it depends on whether the rent review formula in the lease actually refers to the rent as being a percentage of the value of the property/share of property + RPI + 2% or as I have seen simply the "unowned" percentage of the starting rent set out in the lease + RPI + 2%. If the latter then your argument doesn't work, I'm afraid.

I asusme the 2% add on is to encourage people to move on to ordinary property and free up the So properties for new buyers.

Timmne

I think I can see where this is heading! As it happens, it's slightly cheaper to rent than the mortgage would be on the unowned share so I'm not encouraged (other reasons aside) to buy the rest.

Is it worth me going to my solicitor who did the conveyancing to have a look at this for me? Would it be a case of them spending some time re-reading the lease? I'm happy to pay fees but not if it's cut and dry!

Thanks again.