Shared ownership (housing associations and councils)

houndour

Hi,

I'm sure you've heard it all before...myself and my bf have a combined income of £38k, and even on this we cannot get a mortgage large enough to buy in the area we are in. 1 bed flats seem to range at a min of £140-£150k. Anything lower is a studio flat or for OAPs!

I've been looking into shared ownership. I am on the list for Guildford, but I'm moving 5 mins away from my current house and this means I won't be in Guildford borough anymore and they only let you on the list for SO if you live or work in Guildford :mad:

I'm applying for Waverley (but myself and my bf already travel 45 mins-1 hour to work and most of Waverly is even further out).

I was wondering if anyone has experience with Housing Associations as opposed to the council ones. I've been hunting for ones that have houses in Surrey/Hampshire/Berkshire area, but have only found one so far.

Are Housing associations any better/worse than the council ones? I've heard that the only real difference is that the housing associations usually require you to buy a bigger share (over 50%).

When being offered a place to buy, do they only offer you to your needs...so for a couple a one bed flat?

Thanks,
Sam

dragonfly02

I live in Wiltshire and have been looking into shared ownership in the area as we have 2 children already and need a 3 bed house (£120k+)
As a rule what I personally do is check through estate agents direct for shared ownership properties and if you are interested you go directly to the estate agent, they will then give you the forms and requirments for the particular housing association, Please be warned though shared ownership and shared equity are 2 different things.

1) shared ownership - when you sell the house you only have to give the housing association back there initial stake in the property

2) shared equity - you have to give them back there initial stake and a portion of any profit made from the sale of the house.

I am currently paying £575 pcm to rent a 2 bed house and thought buying a house would cost much less than that however it's impossible for us to get on the property ladder as we are not starting from the bottom.

After looknig into a shared ownership house of £75k I thought we would be fine until i found out the housing association were asking £400pcm rent as well.

Certain associations you can pay much lower rent in the reagion of £150 - £200 so it pays to shop around

you could also try this sort of opportunity
http://www.efha.org.uk/keystart/sharedownership/schemes/ruskin.html

krazyk

Hi Sam,

I have started looking for shared ownership/shared equity properties in Newbury, Berkshire. Initially I have found one a shared equity 2 bed terraced house for £83.5k with a housing association. I am awaiting details of all this but how is your search going?

There is supposed to be a fair few properties like this in the area and I think I could just about afford an £83.5k house. The housing association are only asking for £129!

Sounds a good deal to me.

K

dragonfly02

hi Krazyk i've looked at both your threads about shared ownership, Have you checked a mortgage calculator to see how much your repayments would be?
Ive had a quick look and a mortgage for 83.5k over 25 years at only 5% is a monthly repayment of £488 plus your £129 rent to the association this totals £617 per month.

you were saying on the other thread that you can pay at least £535, you should check through all your figures thoroughly and don't forget the interest rates can go both ways as a .5% increase would take your mortgage repayment to £512 also I am renting privatly and we have a yearly reveiw on our rent so your rent may also go up.

My post is not all doom and gloom I live in Wiltshire and I have recently seen 2 bed shared ownership properties for £60k + the monthly rental so I know there are cheaper ones out there.

suki1964

You may find this site helpful
http://www.housingcorp.gov.uk/yourhome/shared.htm

We have a shared ownership with a housing association. We were accepted because we were renting from a housing association already. We were allowed to chose any property on the open market within certain boroughs up to the agreed amount. We chose to buy 50% although we could have just bought 25%.
I think in some cases they do accept lower shares. The one thing to remember is if when you do buy s/o and you want to "staircase" to buying outright, it can only be done in three steps maximum. ie 50% first step,then either the next step will be 50% or two steps of 25% and 25%.

Btw our rent usually increases with inflation but they do have a clause that it can be as much as 5% (if higher then inflation) and this year it was imposed.

krazyk

Yeah I realise that the cost might be higher, but renting, to me, is just throwing away your money as it's not being invested into anything bar the landlord's (and their agents) pockets.

The problem I will have is that I am self-employed, do not have a full year's account yet and have no money at all free for any kind of deposit.

But I'll pay a little bit more on a mortgage/rent combo if I know the money is being invested into a property and that I can sell the property later and get a little bit back.

I've read that interest rates have probably hit their peak for the time being and might start to go down again?

Many thanks for all the info, that last link looks very useful.

K

krazyk

One question from the comments above. You said that you were able to pick pretty much any property on the open market. So if I see a house that is being sold normally (there has been one property on the market for months which just doesn't seem to have been bought for £169k), can I ask if I can buy it via shared ownership or does it have to be on a housing association list or owned by them already?

Hope that makes sense? :-)

K

suki1964

The housing association Im with does both schemes - their own build to buy s/o and also the scheme where as if you are already renting a property from them or any other housing association they will allow you to buy from the open market. I guess this is so they have more properties free'd up to rent. So the house we bought was just the normal run of the mill private sale

Going this route is more flexible to the buyer but start costs are higher. You need to pay for a full structual survey and are paying two lots of solicitors. Also if I remember correctly we were limited to only a few mortgage lenders and trying to swap mortgages to a lower rate seems to be near impossible.

krazyk

It sound slike a no goer for me, but I'll at least enqury on whether I can buy this property I'm interested in that's been on the market for a long time.

At worst all they can say is no.

K

krazyk

Hi there,

I think I've gone as far as I can down this route. I've remembered that I am on a housing list though my situation has changed a lot (for one I now live in the town), but gathering info from the local council and housing associations I find that funding is the only think stopping me from gaining a shared ownership property. And there is none now. All funding has been used.

There are many new homes being built in the area, so will find out if any of these will be shared ownership but other than that there is nothing else I can do.

Perhaps more funding will come?

K