Barratt Homes - Shared Equity?

spud211

Well shared equity has already been covered - its /sometimes/ the only option but in most cases it's better to rent and save - its often cheaper when you work it out. Plus remember that they only ever put their worst/hard to sell properties on the shared equity schemes..the good ones sell without it, so be aware of this.

In terms of Barratt in general - poor quality finishes, they are a large builder but in my experience are responsible for a lot of the poor opinions w/r to newbuilds. Every one I have seen has had terrible internal finishings, often strange layouts, small rooms..and this is on the show homes which are supposed to be the best they have!

Walk into a barratt showhome and then go and find a taylor wimpey or David Wilson one, and just compare the difference..speaks volumes.

They are generally cheap however which is why they sell..I wouldn't buy one though.

rilou81

Id avoid it at all costs. have no idea about shared equity but we went looking at houses to buy last weekend and went to a few new build sites. Was given price lists etc... We then walked around the estate and the house that was selling brand new from Ben Bailey was over 30K more expensive than the extact same house selling private round the corner. Says it all really x

Eric1

murphyxx wrote: »

But at the end of the day I still see renting as a waste of money so that will never be an option for us. ,

It's your right to believe anything you wish, but sometimes renting money from a bank may be a bigger waste of money than renting a property. I'd recommend to compare the numbers and choose your timing carefully.

arby

you ask for advice, but don't seem willing to listen to any advice that goes against what you want to do. surely it's worth trying to look at it again with fresh eyes?

murphyxx

arby wrote: »

you ask for advice, but don't seem willing to listen to any advice that goes against what you want to do. surely it's worth trying to look at it again with fresh eyes?

I am willing to take advice but to start with all it seemed to be was a lecture on how buying a home is a waste of money?

So if i want to buy a home at around 130k and live in it for the next 10 years or so and start a family - has that been a waste of money? I wouldn't say so it's money well spent in my eyes, like i said im not in it to make profit obviously i don't want to make any losses either but my point is my partner and I want to take the next step... like many other people on this forum who are buying houses.

I asked for advice or information on barratts because as mentioned before we are CONSIDERING our options... and as we are finding it a little hard to save up for a deposit, shared equity seemed like a way to get there slightly quicker. I haven't said I will be going down this route for sure, in fact i would most rather pay the deposit and get a mortgage on a house that isn't new build but we are facing the same problems as most first time buyers.

We both live at home so renting would be a waste of money:

1. At the moment we don't have to pay as much in rent or bills - we do pay digs and some bills but obviously living at home is cheaper than renting.
2. We have pets and there is no way we would give them up for the sake of moving into rented accommodation - there are few properties on the market that allow you to keep pets
3. If we rent there is no way we would have a deposit and if we ever move out we would much rather move into a home that's ours for however long we want.

Those are some of the reasons why we don't want to rent... why throw away more money on a place that won't ever be ours, when we could continue to live at home and just put up with it a bit longer until we have a large enough deposit.

I don't know much about shared equity or barratts that is why i asked for advice - I was always a little unsure about it, as mentioned not our first choice. I doubt we will go down this route as it seems like a waste of time and money also but i needed advice from other people to see this.

So i appreciate all the advice given, maybe i took some of it the wrong way easily done over the internet.

poppysarah

murphyxx wrote: »

Those are some of the reasons why we don't want to rent... why throw away more money on a place that won't ever be ours, when we could continue to live at home and just put up with it a bit longer until we have a large enough deposit. .

Why throw away rent on half a place?

(You have to pay repairs on all of it and if that doesn't strike you as a con then nothing can help you)

murphyxx

poppysarah wrote: »

Why throw away rent on half a place?

(You have to pay repairs on all of it and if that doesn't strike you as a con then nothing can help you)

When did i say it wasn't a con??????

I said i doubt we will be going down that route i was always a little unsure about it and wanted other peoples advice to settle my mind. It was only an option we were considering. So I don't think there is any need to be so harsh!

brit1234

poppysarah wrote: »

Why throw away rent on half a place?

(You have to pay repairs on all of it and if that doesn't strike you as a con then nothing can help you)

I think it is time that we let the original poster make their own mistakes. Everyone here seems to of given sensible advise and they have put up two fingers in return.

They will realise that the people here were right when they suffer huge negative equity (far bigger than the alternative rent loses) and suffer the poor build quality. They also will regret it when they fail to sell.

murphyxx

brit1234 wrote: »

I think it is time that we let the original poster make their own mistakes. Everyone here seems to of given sensible advise and they have put up two fingers in return.

They will realise that the people here were right when they suffer huge negative equity (far bigger than the alternative rent loses) and suffer the poor build quality. They also will regret it when they fail to sell.

I'm sorry but I don't know what I have done to deserve such horrible comments.... Did no one read what I said? I'm not having a go at anyone but some people have been a little harsh for no reason. I only asked for advice and because I said rental wasn't an option it's become a major arguement.

Everyone seems to be ignoring the fact that I've said to everyone that I have appreciated advice given, that's what i asked for and I have listened to what people have said.

Ok so I don't agree with the renting idea purely because of the reasons I have mentioned I'm better off living at home, and saving the extra I would spend on a rented house for a deposit on a mortgage later on. It's not like I HAVE to move out it's just that my partner and I want to get our own place sometime soon.

As for Barratts - I didn't know alot about them as a company etc so I asked people for any stories or advice.

Shared equity and new builds - NOT a good idea, POOR quality, UNABLE to sell in the future, LOSS of money etc.. I GET IT... and I have said several times I DON'T THINK WE WILL BE GOING DOWN THIS ROUTE..., again thanks to everyone who gave me a little more info on this, i appreciate it...so why is everyone having a go at me?

BadgerFace_2

OK, a LOT of the posters on here are confusing the barratt shared EQUITY scheme with a shared OWNERSHIP scheme. There is a big difference, the shared equity, you own 100% of the property and the builder will have a second charge over it for 20%. Under shared ownership, you would have to pay rent on the builders part.

Here is a list of possible pitfalls-

-The Barratt scheme normally only gives a loan for 15% of the property, this is normally not enough to secure a good mortgage deal...some builders will give 25% (but that increases the money you owe to them).

-You still need a deposit, the minimum will be 5% of the share you are buying.

-Barratt and a lot of other builders require the 'share' to be repaid at current market value not less than 10 years away. If prices go down, they share some of the loss. If they go up they get some profit.

Bare in mind you will need to repay this and should have another means available other than 'I'll re-mortgage', as this may not be available at the time; so you really need to save up 20% in 10 years, this is a lot of money, and I predict many builder forced sales on the back of this!

There are other builders, if it is your first home, who will give you 25% secured by a second charge, which does not have a lifetime. If you keep the house forever, you never pay them back, or pay rent; this is a better deal and lets you get a good rate mortgage. It would also let you overpay the interest bearing loan (mortgage) instead of save up for the builders loan.

-Barratts house quality is generally poor and they are overpriced because they take part exchange, they have to be. That comes from Barratts own advisors, who offered me 10% off without ever seeing the property.

-Barratt does have a 5-year warranty, which may or may not be of use, but it is the longest around. In addition to NHBC.

-You will be in negative equity from day one, as the deposit is so small and your property will no longer be new. This isn't a problem if you don't want to move for a long time, but bear in mind Barratt will force you to in 10 years if you don't have their money!

-Selling is no more difficult than with a secured loan.

-The valuation WILL be a problem, as any bank that will lend on shared equity will only lend on the second hand value. This is only a paper problem, which means you pay a higher rate on the mortgage.

-Speak to the financial advisor that Barratt will have given you a leaflet for. They are helpful and deal with nearly every builder in Scotland and can resolve some of the above issues.

Hope that helps!

(P.S. I've just bought a house under shared equity with a different builder who deals only with Scotland and it can be done without any of the above ever becoming an issue...but you need to do a LOT of research)