Shared Ownership

Katuska

Thanks izoomzoom!Will do.

Katuska

I thought I'd post an update:

We are selling our Shared Ownership flat now and we have to pay 1% on the TOTAL value of the house. I find it outrageous and so does the person who's done the valuation on the property. I'll try and see a solicitor/ CAB office about this matter; hopefully what the HA is trying to make us do is unlawful and we won't have to pay them 1% of the total value AND their and our solicitor's fees. Unbelievable.

Chubby_Checker

Hello Katuska, Sorry to hear about your experiences of S.O. I nearly bought an S.O. flat in Wembley, very near Wembley Central tube, about 18 months ago, but ended up getting one in Harrow, both were through the same company "Sutherland" ;is this the same company that you bought with?...Although I am quite happy with my place I do believe I paid more than I should have done for my 50% share, but the rents are SO cheap (I pay £130/ month and £70/month service charge) which means , as I have nealy paid off the 50% i can save a bit of dosh towards getiing something else. If it was the same flats in Wembley its a shame because they were big and spacious, (certainly bigger and better value than the place I got.) Its true that "Sland" as a company arnt the sharpest tools in the box, i recently had to send them a cheque, but the prepaid envelope was addressed to their old office which has closed down...this kind of thing seems to happen to quite a few folk, the communications aint good

Katuska

Hi Chubby,

Sorry just seen your post.
Well, looks like we could have been neighbours as we DID buy the Wembley property you're mentioning. Lucky you with your low rent/charge,we pay £512 rent a month on the 75% share the HA owns!! We bought the flat for £189,000 (not £198 grand as mentioned in my previous post!!) and now they're worth £206,000. It is really annoying as smaller flats 100 yards down the road are selling for £230,000 because they aren't on this housing estate.
Definitely not an investment! Pfff....

lady_noluck

Many moons ago (1998 to be exact) I bought a SO through Servite Housing and must say it was fantastic. Had no problems, everything progressed well, HA were excellent and I even made a tidy profit when I sold my share. I'd say go for it!! :j

brainiac44

this is the most insidious factor of the whole housing bubble.

shared ownership is when you pay the complete 'non boom' price of the property (90k) then pay in rental an additional amount to cover speculators profit of a further 90k.

in between then and now your wages are taken apart by interest rate rises, rent rises on the half of the property not yours and rising maintenence. when thats done you can start on the other half. thouroughly ripped off.

all of course all rises are above the governments level of age inflation growth - 2%.

bye bye earnings. hello overtime.
for nothing.

wait 2-3 years. dont be mental.

Chubby_Checker

nice to get the reply from Katsuka, I hope everything has worked out for you now. I am thinking of maybe selling up my share, I bet I dont make any profit at all if I do, but to have to pay £700-£800 to rent a i bed flat on open market puts me right off, so looks like I am here for a while...Who knows I may leave london altogether (was going to move to Hastings a few years ago, wish I did now). I hate the housing market of the last 8 years.

lynzpower

Dont be negative Chuibby We rent a 2 bed house with garden in gorg area of town for 750 pcm! Mucg better VFM than the shared ownership mortgage

djheath

I am/was trying to get on the property ladder and looked into shared ownership after my friend back at uni (leeds) bought her first flat using the scheme.

It seemed like a great scheme! I applied for the other scheme as well where the government gave you a 25% loan to help you buy a house on the open market.

I live and work in Surrey - one of the most expensive areas to live in outside of London and 1 bed decent flats here are around £160,000+ with new builds being around £200,000+! If I tried it on my own with my savings of £20,000 and tried to get a mortgage I was told I could afford about £130,000 at a push with mortgage repayments at about £800 a month! I doubt I would be able to survive on that so the SO scheme sounded great.

That is, until you look into it! I found I was being sent info on new houses being built that cost over £200,000 and 40% shares where available for people earning over £25K a year. Not me! I found that the mortgage and rent together came to about £800 so similar to if I went it alone.
Nothing took my eye as being any good though!

Then in November I got the letter I was hoping for! I had been accepted to receive a loan for 25% of the cost of a house and had a month to find a house! Brilliant I thought! that meant I could add 25% on top of my maximum I could afford so £130,000 of my own limit now became £180,000 ish! Woohoo! However, the loan is only available if you go through the participating mortgage lenders. And as its a government scheme its very strict on how you play the market. Where as you can usually borrow 4 to maybe 5 times your salary from a normal advisor, through the scheme they wouldn't budge on the 3.5 limit. That meant, with the 25% extra from the government scheme, I was allowed to borrow a whopping £120,000!!! Yes LESS than I could get if I went ahead and got a house without using the scheme!! And thats before I even get into the whole deal with being forced to stay with the mortgage company throughout the whole time you own the house. You cannot change so they can put the interest rate up 10% for example and you cant do anything about it! It looked very likely you will lose money if you sell too, if house prices go down which is likely at some point.

So I have given up! I reckon the scheme works well in areas where house prices are still quite lowish - up north etc - but down south its just ridiculous. You cant get a good deal and end up in a crappy new build house that is paper thin and usually in a crappy area.

I am currently looking to rent instead and waiting for the property boom to burst like a flan in cupboard!

Sorry for the long read but hope it helps somewhat.