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Shared ownership - something to look at if you "own" one
Comments
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Having read your story, i can see that you 'think' you are buying a share of a house, you are still paying rent on the other bit, and even though you think differently, you will have a pig of a time trying to sell it with the restrictions.Not quite sure why I'm replying as all said before but seriously these people who have nothing better to do than slate S/O really, please find something better to do! The fact is if people want to buy one then that is their problem isn't it?
We bought a new build almost 3 years ago for £153k the exact same houses near us were on private sale for between £165-£179k so we wondered why ours was so cheap..if you look back over my threads you will see i asked about this a long while back..anyway our mortgage is about to end on its fixed deal so we have secured another one..the property is being valued next week and is going to (hopefully!) come in at around the £180k mark but the EA reckons higher..(one went up for sale last week and one valued and both smaller so thats why he thinks more) therefore we have quite a bit of equity and have gained approx £10k per year since buying it. Our mortgage has dropped a LOT allowing us to overpay and get it knocked down even more..all in all very pleased.
BUT yes there is no assurance we will ever own this house outright..we have already discussed that if we pay off our % we will just rent the other half (at the mo this is £150 a month) so we can't really go wrong as far as i can see can we?
As for selling maybe we are lucky but the houses we have are in a lovely area, all landscaped, 10 min walk to the beach etc) and the waiting list for S/O is horrendous, i have no qualm that we would sell it quite quickly but we bought this as a home and not an investment and always knew/know that it may not sell (like many other normal houses) or we may lose money (like many other normal houses!)..so rather than paying our friends house off we are buying a little of our own..sure beats renting that's for sure.
I LOVE this house and would buy it again tomorrow if we had to start again. We have had no outlay other than boiler service and us changing bits so been a very cheap move too.
So long as you go into it knowing what you are doing and what the worst case scenarios are I can't see the problem.
Regardless of what your neighbours houses are worth, you will never get to that level because its an SO property and massively unlikely you will ever make anything from it.
SO is just a rebranded rental agreement.
There is a big difference between 'slating' SO and giving advice on the pitfalls on it.]
Unfortunately you failed to grasp the difference.
I am glad you like your home though, and it's right for you.0 -
Seems there are some really interesting viewpoints both ways.
we have just been accepted on a SO property. It's a 40% share of 210k property. We are currently renting and paying £715 a month.
we need a certain sized house due to having 2 young kids but only have my wage as the good lady wife is being a mum rather than working so only have my wage of 30k to go on.
if we stay renting for a further 5 years we'll pay £42900 in rent alone (assuming rental doesn't increase at all) and so SO with as high a repayment as possible seems to me to be the best option to get anywhere near avoiding paying someone we've only met once over 40k.
would appreciate thoughts as we can't afford to buy a flat or house fully in the area or nearby due to high costs and wage. this way when good lady wife can start working when youngest is in school all her wage (within reason and charges) can go to overpaying mortgage.
if you don't think we're going in the right direction i'd really love to hear what other options we have please
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Seems there are some really interesting viewpoints both ways.
we have just been accepted on a SO property. It's a 40% share of 210k property. We are currently renting and paying £715 a month.
we need a certain sized house due to having 2 young kids but only have my wage as the good lady wife is being a mum rather than working so only have my wage of 30k to go on.
if we stay renting for a further 5 years we'll pay £42900 in rent alone (assuming rental doesn't increase at all) and so SO with as high a repayment as possible seems to me to be the best option to get anywhere near avoiding paying someone we've only met once over 40k.
would appreciate thoughts as we can't afford to buy a flat or house fully in the area or nearby due to high costs and wage. this way when good lady wife can start working when youngest is in school all her wage (within reason and charges) can go to overpaying mortgage.
if you don't think we're going in the right direction i'd really love to hear what other options we have please
That I think is the crux of it, rental is dead money.0 -
That I think is the crux of it, rental is dead money.
£715pm on a place worth around £210 is rougly 4% thats cheap housing.
Interest on a loan and the rent on SO is also dead money and you are responsible for the maintanence.
That 40% of £210k is £84k say @ 5% thats £4200 over 5 years that £21000 of that dead money accounted for.
Whats the rent on the other 60%(£126k) over the 5 years whats that going to be, lets say 2% £2520py so thats another £12600
That £35600 dead money before the other costs of ownership.0 -
Its nearby. She plans to stay with the corporate side of the NHS. She started a better job (same office) last Monday.
NHS corporate I can see the axe falling there when the NHS gets another reorg.
One of the real benifits of jobs in the NHS is mobility there are potential jobs everywhere. Buying a house ties you to the current area for someone so early in ther career this is not a sensible thing to do if they want to get on, rapid progression come from chasing the better jobs wherever they are.
I also think now is the wrong time to be buying for any public servant.0 -
That I think is the crux of it, rental is dead money.
That is such a silly phrase!
Renting gives you a roof over your head. Which is rather important, to most of us....much enquiry having been made concerning a gentleman, who had quitted a company where Johnson was, and no information being obtained; at last Johnson observed, that 'he did not care to speak ill of any man behind his back, but he believed the gentleman was an attorney'.0 -
Having read your story, i can see that you 'think' you are buying a share of a house, you are still paying rent on the other bit, and even though you think differently, you will have a pig of a time trying to sell it with the restrictions.
Regardless of what your neighbours houses are worth, you will never get to that level because its an SO property and massively unlikely you will ever make anything from it.
SO is just a rebranded rental agreement.
There is a big difference between 'slating' SO and giving advice on the pitfalls on it.]
Unfortunately you failed to grasp the difference.
I am glad you like your home though, and it's right for you.
Sorry completely disagree with your comment.
There is a huge waiting list where we live for S/O hence us trying for years to find one in the right place. When these came up they went within hours, to say I was stressed with the whole hoping we got one scenario is an understatement as I loved/love the house so much. We live in a desirable (to most! quaint narrow streets etc.!) holiday village so houses are at a premium due to many holiday cottages or second homes so anyone trying to buy who is young like us struggles unless they have a huge deposit which we didn't have or need (paid £150 for this). The houses are also an issue where we live due to the steep hills so I would say 60% have either no garden or parking to which we have both and a garage which is rare. Selling I don't think will be a problem BUT we don't want to move and this was a long term investment for us so doesn't matter. Next door is going up for sale soon also S/O so we will see what that comes in at and how it goes as a guide..only because I'm nosey!!
As for reaching the same as the neighbours prices well we will see hopefully next week when it is valued..again so long as we can pay the mortgage I don't care what it values in at. That was the whole point of this house, the fact we can afford it and don't struggle like lots of people do just so they can say they 'own' a house..sounds good on paper doesn't always stand true though. When we bought it was loans and things to pay off so were on a far less income so we knew we would have more after the first year to save each month which we do. We have our new mortgage starting in Sept and we can afford to really overpay it to knock it down so are doing that while we can.
I can honestly say where we live I would buy it again all over again as for us it is perfect, has lots of benefits which others don't so we are settled and happy. Me and my sister were looking at houses the other night..it was rather funny our comments on some to say the least! I think if I was given free reign to buy a 'normal' house we would still be in the depths of re fitting kitchens, bathrooms, decorating etc looking at most peoples tastes, actually id'e still probably be looking!
I understood your post too I just get fed up of the negative comments about S/O..people who don't like it then..don't buy one?!0 -
getmore4less wrote: »£715pm on a place worth around £210 is rougly 4% thats cheap housing.
Interest on a loan and the rent on SO is also dead money and you are responsible for the maintanence.
That 40% of £210k is £84k say @ 5% thats £4200 over 5 years that £21000 of that dead money accounted for.
Whats the rent on the other 60%(£126k) over the 5 years whats that going to be, lets say 2% £2520py so thats another £12600
That £35600 dead money before the other costs of ownership.
But any of that 'rental money' is surely dead money whether it is S/O or not? a roof over your head is a fair enough point as someone has said. (I have rented many places I can tell you) At the end of the day for us it is a secure home. Tired was I of getting calls or letters saying 'sorry we are selling' 'sorry we are putting the rent up', etc etc. Think I have moved and rented approx 9-10 properties in the space of 4 years which is shocking, most of them I wasn't overly keen on (the last one was the best) but the owner used to come round with his daughter (my dd's friend) and say things like 'all this will be yours when you are older'..i used to feel a slight annoyance that I am buying her house for her! Maybe the wrong way to look at it but dh and I got fed up and chased the long await of S/O up.
I love the fact I can come back and sleep at night knowing it is our house, I love to be able to decorate it as I like and not be told we can't put a shelf up etc.0 -
if we stay renting for a further 5 years we'll pay £42900 in rent alone (assuming rental doesn't increase at all) and so SO with as high a repayment as possible seems to me to be the best option to get anywhere near avoiding paying someone we've only met once over 40k.
if you don't think we're going in the right direction i'd really love to hear what other options we have please
You'd be renting the other %?
Rent. Buying an overpriced prop keeps the housing market out of your reach.
If everyone had said "no i wno't buy a % of a house" then they would have had to lower the prices...0 -
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