Shared Ownership Property

sarahspain

Can someone give me the basic lowdown on how this works, who to contact etc... and whether you need a deposit to put down?

We are currently renting but want to look at what other options are open to us.

Thank you!

AndrewSmith

HI,

As the name suggests you are buying a share in a property, the other share usually being owned by a Housing Association. You pay the mortgage for the share you own, and rent for the share owned by the Housing Association. The amount of rent will vary Depending on the Housing Association, the property, and the share you own.

You may have the opportunity to buy further slices or shares at a later stage. This is called staircasing. The exact terms and conditions will vary from association to association though, so check carefully.

Funding:
It is possible to purchase your share without a deposit, however this will limit you quite considerably as to the number of lenders available. Most lenders will lend on shared ownership if you have a 5% deposit, relating to your share. EG:

Assuming you buy on a 50/50 share basis (This is not necessarily the only split),

Total Price £150,000
Buying 50/50
You buy £75,000 share
5% deposit= 5% of £75,000 = £3,750

Or you obtain 100% finance on £75,000 (fewer lenders though).


My advice would be to contact your local Housing Associations and request the paperwork for any developments they have and register with them for the scheme. You may find there are more than one Housing Association in your area, a quick yell.com search should find them.

As to whether Shared Ownership is right for you? well that's something no-one on here will be able to tell you. Read the terms and conditions very carefully and take advice from a local solicitor (most will offer you a free 30 minute consultation) regarding the legal side.

Hope this helps

Andy

lynzpower

There are loads of good and bad points to SO. Im in one now.

For me the downside of it is that the lease is rather prohibitive, and we cant have pets. This is the main reason why we intend to sell up and move to somewhere on the Open Market. However, I *bought* this on my own, now I have OH, so we will be able to buy something between us but as a single person I wouldnt have.

Personally, Id wait and have some deposit, its nice to know I do have some money tied up in this ( albeit less than 10K) that is some security should my finances ever hit the rocks big time.

sarahspain

Thanks for your help.

Is shared ownership available to non key workers? and non first time buyers? (we did own property previously but sold up and lived abroad for a while)

AndrewSmith

It is available to non keyworkers.

Your situation having previously owned would be at the descretion of the Housing Association concerned.

Andy

charlie007

i also have a sharedownership property. Mine has been part of the shared ownership for about ten years and we moved in two years ago. The prices of them are not any reflection of the current open market in this area unless you manage to get onto a new development. Our neigbours recently sold up and they had about 30 viewings and out of that 15 people made an offer, for well over the asking price. Just a word of warning, it may be better to buy small on the open market if you can possible afford it. We are about to put ours on the market, we own 50% and the estate agent valued it at 20,000 more that we paid for it (just for our half!)

Having said all that we would not have been able to afford anything else so it has got us on the property ladder!