Shared ownership - selling my half

confused345

Hi people. Im looking for some advice.

I bought a house with a friend approx 4 years ago for £118,000 in total and paid £15,000 each deposit leaving an £88,000 mortgage.

I am looking to move areas and so we obviously have to main options. sell up completely or he buys out my half. The house is currently only valued at approx £96,000 meaning that should we sell for that price we would come away with only £8000 to split between us.

My friend has basically offered me £4000 to buy out my enitire half. However, although i understand the reasoning behing that, i feel that the offer should be significantly more considering the deposit i paid and the money that has been spent on the house over the last few years, all of which he is going to inherit.

Basically, can anybody offer me any help here in determining a fair price as i dont believe that £4000, even in the current climate, is a fair price for 1/2 a house and all the improvements that have occurred. I feel like i should also add that ALL of these improvements, although financially 50/50, have been down to my effort and time with VERY little input from his side.

Any help would be great.

Cheers!

BitterAndTwisted

Get three estate agents round and have them to do a realistic valuation. That's your starting-point for a discussion about selling your share to the other party.

If the £96k is a realistic price then coming out with £4k seems quite fair to me. Imagine how little the property could be worth now, in a falling market, if you hadn't done those improvements....

Orpheo

BitterAndTwisted wrote: »

Get three estate agents round and have them to do a realistic valuation.

:lipsrseal

:cheesy:

:rotfl::rotfl::rotfl:

This is what happens if you ask an EA for a realistic valuation.

http://www.youtube.com/watch?v=HY-03vYYAjA

brit1234

Check the land registry figures for the block.

http://www.houseprices.co.uk/

£4,000 sounds fair. Especially if it means you won't ever have to go through the nightmare of selling a shared ownership home.

dorset_nurse

Remember that you still have a mortgage on your half so you don't own your half completely.
You only have a few options- take the hit to get out (which I wouldn't do having spent on the mortgage for four years) your friend sounds like a businessman!
If your friend allows you could move out and continue the payments and let your room to cover the cost.
Or you both have to agree to sell at the lower price and loose money on the price you paid.

If it was me I would have already have made a written agreement on what would happen in a situation like this. (Did you discuss this?)

I would push to move out and let my room. If your friend isn't ok with that you could tell him to sell the house completely where he would also lose out and be more likely to accept your terms. You could be nice and let him choose his house mate!
If all fails I would be tempted to move out and continue paying the mortgage to prevent losing out as long as I could afford the payments as well as the rent/mortgage I was paying elsewhere.

brit1234

dorset_nurse wrote: »

I would push to move out and let my room.

Its shared ownership, there is a high likelihood that one of the vast restrictions is not to allow sub letting.

Walk away before this scam scheme takes any more of your money.

Jimmy_31

confused345 wrote: »

Hi people. Im looking for some advice.

I bought a house with a friend approx 4 years ago for £118,000 in total and paid £15,000 each deposit leaving an £88,000 mortgage.

I am looking to move areas and so we obviously have to main options. sell up completely or he buys out my half. The house is currently only valued at approx £96,000 meaning that should we sell for that price we would come away with only £8000 to split between us.

My friend has basically offered me £4000 to buy out my enitire half. However, although i understand the reasoning behing that, i feel that the offer should be significantly more considering the deposit i paid and the money that has been spent on the house over the last few years, all of which he is going to inherit.

Basically, can anybody offer me any help here in determining a fair price as i dont believe that £4000, even in the current climate, is a fair price for 1/2 a house and all the improvements that have occurred. I feel like i should also add that ALL of these improvements, although financially 50/50, have been down to my effort and time with VERY little input from his side.

Any help would be great.

Cheers!

The deposit you paid has mostly gone due to the value of the house falling so i can understand the other party involved not wanting to pay you more than something is worth, also he isnt buying half a house from you, he is buying half a mortgage debt from you.

I would take the 4k.

dorset_nurse

brit1234 wrote: »

Its shared ownership, there is a high likelihood that one of the vast restrictions is not to allow sub letting.

Walk away before this scam scheme takes any more of your money.

He states that he shares ownership with a friend... OP please let us know if this is part of a shared ownership agreement, or just joint ownership with your friend.

If it is a scheme I would get out; the latter see my previous post.

Cleaver

confused345 wrote: »

Hi people. Im looking for some advice.

I bought a house with a friend approx 4 years ago for £118,000 in total and paid £15,000 each deposit leaving an £88,000 mortgage.

I am looking to move areas and so we obviously have to main options. sell up completely or he buys out my half. The house is currently only valued at approx £96,000 meaning that should we sell for that price we would come away with only £8000 to split between us.

My friend has basically offered me £4000 to buy out my enitire half. However, although i understand the reasoning behing that, i feel that the offer should be significantly more considering the deposit i paid and the money that has been spent on the house over the last few years, all of which he is going to inherit.

As others have said, get some other valuations. If it does come back as being valued at around £96,000, then that's what it's worth, it doesn't matter how much you've spent on it between buying it and now.

Your friend is basically offering you the opportunity to walk away with what you'd come out with after selling, without the hassle of actually having to go through the sales process. I imagine that selling a s/o house in this market will be really difficult and may not sell for anywhere near £96k. Personally, I'd bite his hand off and run away with the £4k.

HAMISH_MCTAVISH

confused345 wrote: »

Hi people. Im looking for some advice.
!

I'm assuming you and your friend bought together and have since been sharing the house as housemates?

If so, then rent your half out.

Your friend gets a new housemate. You don't crystallize a loss at the bottom of the market.

Everyones a winner.

brit1234

HAMISH_MCTAVISH wrote: »

I'm assuming you and your friend bought together and have since been sharing the house as housemates?

If so, then rent your half out.

Your friend gets a new housemate. You don't crystallize a loss at the bottom of the market.

Everyones a winner.

1, What happens if you are not allowed to sublet?

2, What happens if the other owner does not like the the new renter?

3, What happens if there are void periods with renting, who pays the costs?

4, What happens if prices fall further which are likely to happen?

Take the £4k while it is still on offer, you would be mad not to. Get on with your life and stop having this noose around you neck.