Shared ownership/equity is a scam.

Lou67

It's probably not a scam, but it's something I would never entertain. The Shared Ownership schemes around my area leave you fully responsible for repairs, and you 'can' end up shelling out a fortune... Paying more than you would by simply renting or simply buying, in addition to the maintenance of the property.

It suits some, it wouldn't suit me. My pal does it; and she has a mortgage on a quarter of the property which costs £300 a month, and her rent is £400 for the other three quarters, and she has to have loads of insurances and pay for anything that goes wrong. She said it's one of her biggest regrets...

And if you *do* wish to sell, you may find it hard to sell 25% of your property.. many people do not like shared ownership. And even if the council 'do' cough up for the rental share, you will still have to find the mortgage money, and it could be several hundred pounds a month. The 'unemployment insurance' often does not kick in for a few months.

Some people are OK with it, but it's not for me I'm afraid. It's not necessarily a scam, but *I* think it's a bad move to go into it...

Ulfar

Idiophreak wrote: »

Err, no, not really. As I said earlier, it's just a way to replace the 100% mortgage, so the schemes are mainly aimed at people who don't have a "conventional" deposit.

I know five people on SE, including myself - all of them can *easily* afford the mortgage and save for the loan at the same time.

If you don't have a deposit and haven't managed to save one then you cannot afford a conventional mortgage.

100% mortgages were not conventional by any measure they were an aberration that should never have happened.

Idiophreak

Ulfar wrote: »

If you don't have a deposit and haven't managed to save one then you cannot afford a conventional mortgage.

Ha.

Would you say "if you need a mortgage, you can't afford to buy a house"?

What's the difference?

Why is taking one loan for a house "affordable", but taking two loans for a house "unaffordable".

You say "haven't managed to save one", like there's a skill to it. Personally, I "hadn't" saved a mortgage, but would have "managed" to if I'd needed to.

There was finance available to enable me to buy a home off the bat without peeing money up the wall on expensive rental while I saved a deposit, just so I could "afford" your "conventional" mortgage. I could easily "afford" to service this finance, so I took it. What's "unaffordable" here?

kingstreet

Help To Buy still requires a deposit. There isn't a 100% option. The buyer has to come up with at least 5% of their own - no builder gifted, for example.

Idiophreak

kingstreet wrote: »

Help To Buy still requires a deposit. There isn't a 100% option. The buyer has to come up with at least 5% of their own - no builder gifted, for example.

Yeah, kinda defeats the point a little IMO. If you have to pay 5% of an (always higher) new build price, you may as well put your food shopping on CC for a few months and scrape together 10% of a second hand house, then go on 90%LTV. Will pay a little more interest in the short term, but at least you'd be "on the ladder", so to speak.

kingstreet

TBH if you can get 5% deposit plus a 5% builder gifted, there are lenders who'll do 90% of a newbuild house, so you could buy that way.

brit1234

Debate on affordable housing on last nights Question Time. Link below: 49mins in. http://www.bbc.co.uk/iplayer/episode/b02zc9l5/Question_Time_20_06_2013/


"The government has been trying a huge range of initiatives to get the housing market working again.One of the reason some developers weren't building housing was because they saw house prices going down, down and down. They didn't want to build an asset which would fall in value."

More evidence that Help to Buy and other schemes are designed to inflate house prices for the builders and not help buyers.
:mad:




Russell puts the question to Borris on so called Affordable Housing "Who are they affordable for mate, who are they affordable for?"



Boris can't answer question. Then the host puts to him "How many of them are affordable, what price are they at?" He waffles for a minute and avoids the question again.



The truth is all these schemes are to help the builders keep prices high and make buyers overpay for the benefit of the builders who are holding the country hostage by refusing to build actual affordable homes.

These schemes are scams, pure and simple!

Idiophreak

brit1234 wrote: »

The truth is all these schemes are to help the builders keep prices high

You continually overlook the fact that it's not just builders that benefit from maintaining house prices...is that deliberate?

martinsurrey

brit1234 wrote: »

The truth is all these schemes are to help the builders keep prices high and make buyers overpay for the benefit of the builders who are holding the country hostage by refusing to build actual affordable homes.

In fact, builders want to build, its land owners who gain the most from development.

When it costs £20m to buy a patch of land in London, and then you have to build a set of apartments, and give the council a few £m through a s106 agreement (for them to spend on schools), its hard to get the price of an apartment down.

The landowner however has just got £20m for pretty much nothing.

I know builders with planning permission for 100’s of houses that they can’t build, because as soon as they put a spade in the ground, they have to give the land owner the full price of the land, and that makes the development unprofitable, so they have to wait for prices to rise, or the land owner to agree to drop the land price (not going to happen often).

brit1234

Idiophreak wrote: »

You continually overlook the fact that it's not just builders that benefit from maintaining house prices...is that deliberate?

Let me correct your question.

You continually overlook the fact that it's not just builders that benefit from maintaining artificially high house prices...is that deliberate?

No it is not deliberate however this thread is about shared ownership and shared equity schemes being a scam. I can say that property speculators benefit from all these measures to keep the housing bubble going but this is not what the thread is talking about.

I think the vast majority of people would benefit for all these so called affordable housing schemes to be axed and all the other props removed so that house prices can find their natural level which is a lot lower.

We desperately need this interventions to stop and allow a free market to determine house prices.