Shared ownership?

marking_bad

Is this a good idea or something to avoid?

For example

http://www.findaproperty.com/displayprop.aspx?edid=00&salerent=0&pid=4777962

Would it be good for someone who cant get a mortgage but can afford the 50k to buy half the house?

Bananamana

have a search of the forums - there are a considerable number of very recent posts

https://forums.moneysavingexpert.com/discussion/2594381

https://forums.moneysavingexpert.com/discussion/2591665

marking_bad

They seem to be talking about it as an investment (ie. it's not a good one), whereas I am someone who cant get a mortgage and I am looking for other options.

DanielleNic87

I am looking into Shared Ownership. I know alot of people on here think it is a bad idea, but as a FTB I simply cannot afford the 20 odd % deposit that mortgage lenders require.

marking_bad

These are government run schemes, are they making a profit from it?

Ie. do they accept cash buyers (for the 50%) or is it only for those who can prove they are on a low income?

DanielleNic87

They are done through housing associations. You have to be registered in your area. In my area, you can earn no more than 60k a year.

They make a profit from it, as you part rent, and then when you go to sell, you have to pay pack the percentage that you dont own at market value.

DanielleNic87

O and yes i think they accept cash buyers

marking_bad

But you have to prove your income to them like if you were applying for a mortgage?

Registering with the council, so I assume it's a queue and people are given priority like social housing?

DanielleNic87

When i registered they didnt ask me to prove my income, i guess they may do when i apply for one.

Yes in my area the is 4 priorities. Can't really remember what they are, but i am bottom of the list.

MobileSaver

marking_bad wrote: »

Is this a good idea or something to avoid?

The biggest problem comes when you want to sell at some point in the future.

It's hard enough right now for people who own 100% of their home but the restrictions on selling a shared ownership make it much worse for these sellers. Several years down the road you may discover that finding a suitable buyer takes so long that you lose your next dream home or that you have to take a serious hit on the sale price to sell at all.

brit1234

Prices are falling now, time to save a bigger deposit in mean time and buy normal/ If you get shared ownership now you will get big negative equity as prices correct.