Shared ownership?

marking_bad

The link ive posted in the original post, is that government based or something else?

edgex

DanielleNic87 wrote: »

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.

then you cant afford to buy a property

cashbackproblems

Will you be borrowing the 50%, you need to find out whether you can meet monthly repayments as you will also be paying rent for the other 50%, you need to find out whether this rent goes towards you eventually being able to fully own the house and the t+c's around this. Generally speaking the schemes iv looked at in london arent good value but as you said if its this or wasting money renting this might be the best option.

For me to buy a 2 bedroom flat in a decent part of london i need 250-300k and earning 30k its gona take a massiveee deposit/number of yrs renting. Either tht or buy a bedsit in east london.

DanielleNic87

edgex wrote: »

then you cant afford to buy a property

I can if i get a 50 % share in a property.

Paul_the_Painter

Seems a lot of people posting have not bothered to read the link you posted.

This is a resale of a previously purchased shared ownership property, as it is being advertised on the open market there are no restrictions on who can buy it.

Often there are restictions on who can subsequently buy a shared ownership property - but not by any means always. Check this out before you buy!

I have a property that is very similar
I can sell mine to who I like, when I like, for how much I like, and if I so choose rent it out for whatever I like.

A lot of new shared ownership is very restrictive - the old stuff is generally much more flexible. Many people also think that it is a new concept, but mine was built as a shared ownership in 1985.

The notional interest rate on the rent is about 3% so much cheaper than a mortgage, that's acually pretty high. I own 30% of mine and pay £205/month, and it's worth about £150k - so notional interest rate is about 2%

Rent plus mortgage on the full 45k should come to about £400/pcm add in £100 for council tax and £100 for other bills. £600 pcm all in for a 2 bed house - sounds like a deal to me.

Warnings-

Your mileage may vary
Not all shared ownership properties are the same
You must keep up payments on a mortgage
Check who you can sell it to
See if there is a premium to pay

Shared ownership is a good idea - limiting who the purchasor can re-sell to is a bad idea - anything that has a shared ownership element with a developer/builder is generally a bad idea.

Never ever buy more than 50% - unless you buy 100%

MobileSaver

Paul_the_Painter wrote: »

This is a resale of a previously purchased shared ownership property, ... there are no restrictions on who can buy it.

Shared ownership is a good idea - limiting who the purchasor can re-sell to is a bad idea

Restrictions are due to more than just whether there's a HA involved.

There are far fewer mortgages available for shared ownership than normal house purchases which significantly affects eligibility and desirability.

poppysarah

edgex wrote: »

then you cant afford to buy a property

I wish that had been the government line for the last so many years.

Paul_the_Painter

Around my way - Milton Keynes, MK Council Shared ownership properties stay on the market for about a minute before a purchase is agreed.

Although mortgages are harder to come by, the limited amount of equity required makes them very attractive for those divorcing and indeed BTL Landlords.

The new ones owned by Housing Associations languish around for ages.

Common "down the pub" conversation with estate agents (some are nice people!) consist of.

Agent: "so where do you live?"

Me: "round the corner - got a Shared Ownership place"

Agent: "Council or HA?"

Me: "council"

Agent: "Nice! if you ever want to sell, I can do it off the books for cheap, have it sold within a day - here's my card"

Me: " Thanks" - card in wallet - followed by card in bin

With regard to mortgage eligibility Mobile Saver is dead right, I currently own 30% without a mortgage, I was looking at buying another 10-20%, but the mortgage companies wanted me to pony up a deposit for the extra! Seemingly ignoring the ~£50k of equity I already own.

They would have been happy to loan for example £50k if I put in £25k to buy a 50% share of the house.

but they wouldn't lend £30k to bring my share up to 50%

Crazyness