Shared ownership

poppysarah

brit1234 wrote: »

I'm glad the government have stopped funding shared ownership, it is a complete scam. The move now is to affordable rent, so that will cut off the maintenance issue and people getting trapped.

If only affordable was going to mean that.

Property_Auctions

Frankie56 wrote: »

I bought a house some years ago with a housing association. I own 1/4. I had to sign to say that I would be responsible for all repairs and I have to pay them for buildings insurance as well as rent for 3/4 of the house. I felt,, because of personal circumstances, that I didn't have much choice at the time. I recently asked if there was any way they could help me out because the windows need to be replaced and the heating boiler won't last much longer but they said there was no way they could help. I have to pay for it all myself.

I now feel that this is very unfair as I have to pay to keep their part of the house in good repair and they will get 3/4 of the profits when the house is sold, even though they say they are non-profit-making.

Is anyone else in this situation? How do you cope? Does anyone know anywhere I can get help with these repairs as I am in a very low paid job and in receipt of housing benefits and live alone?

Frankie, you mentioned in the first two lines that you had to sign to say that you would be responsible for all repairs. It seems as if by agreeing to this that you have waived your right to any assistance.

bunnybunnyrabbit

If you decided to sell whilst you only own 25%, you are selling just that - your 25% share. The housing association will retain their share. So if the value of the property has increased, you would receive 25% of the full value, so you'll make a profit. The housing association isn't actually selling anything at this point (unless you staircase to 100% and sell simultaneously).

Also, the rent you are paying on the 75% is lower than open market rent as you also have to pay for your own repairs.

Shared ownership isn't a scam IMO. Often your monthly outgoings will be cheaper (mortgage + rent + service charge) than if you were renting/buying normally plus you get a foot on the ladder. You get to build some equity in the property so you can either sell up and get a deposit for a property on the open market or you eventually staircase to 100% ownership. Obviously the current economic climate is causing problems for everyone who owns a home - not just shared owners.

pioneer22

smileytiger wrote: »

I live in a shared equity which i bought 50% share in 1995 - at the time yes it was the only was i could afford to buy. In 16 years the only contact i have had with the developers who own the other 50% is to discuss rent rises/reductions (yes sometimes it goes down:D - as it's linked to house value) I knew to all intents and purposes it was my house & my responsibility for everything else.
I will be selling up after Christmas as we are now going to downsize & they are entitled to 50% of the profit of the sale of the original house ie Any improvements which i have done which have added value they are not entitled to profit from. There are very strict conditions in the trust deed i signed on purchase.
So whilst shared ownership can be horrendous - you must read all the small print before you sign and realise what you are signing up to - it's not a cheap way to own your own home.
That said i've been very happy - i've a lovely 3 bed semi in a great location, have raised my children here etc so i personally have benefitted from having a house that i would have never been able to buy outright & when i sell i'll walk away with a decent bit of equity on my 50% as i have hardly any mortgage left to repay - that's how i look at it

What did you buy it and sell it for if you dont mind me asking

carefullycautious

I can hear Judge Judy shouting 'get another job' to pay for repairs if you are desperate.

Why after 16 years of your children leaving have you no savings?

If I was that desperate I would take in lodgers do a second job etc

However,if you are on benefits and unable to work there may be charitable help available if you worked for a company or were in the forces etc.

More information please on your situation

Frankie56

And another thing - Yes, I suppose I could use the profit to put down on another house but I don't really want to move.

Property auctions - I was hoping they might be able to help me by way of a cheap loan but they can't.

Carefully cautious - I did try starting my own business as well as working for an employer but unfortunately it isn't going too well. I have been on minimum wage, live on my own so don't have anyone to help out with bills and haven't had much money left over to save very much. I do get a little help from housing benefits.

carefullycautious

I live with my hubby and 5 years ago downsized from 3 to 2 bed we are now trying to go down to one bed as we do not need excess space we dont need or want to heat.

You have to try to live within your means, if that means moving then so be it

I know this sounds harsh but its a tough life out there and no one owes you anything.

janealb

scheming_gypsy wrote: »

I'm in shared ownership as well, and when I bought the house i wasn't under any impression that they'd be doing repairs, replacing anything or even decorating for me.

they don't live in my house so they're not going to benefit from me having a boiler replaced so I have to replace it myself. I might have to replace 4 boilers in the time I live there so why would they pay for them when they won't benefit from them at all? even when I sell the house they're not going to make any money on the boilers because it's not adding value to the house.
If i sell at a loss then they'll receive 40% of the selling price not the buying price. So again they're not going to benefit from anything.

If you weren't shared ownership but had a full mortgage, who would you be wanting to pay for the boiler or replace the windows? You'd still be in exactly the same position you are now but you'd be paying out more money for the mortgage.

sorry but the issue has nothing to do with shared ownership, it's your house, your boiler and your windows. If you want somebody else to pay for them, you should rent and not buy.

I have to agree with this. They have 'helped ' you buy a house you live in. If anything needs repairing is because you live there. You're not paying any rent to anyone and can't expect anyone to take care of your home.

MarkyMarkD

Well, not quite actually, jane, because you normally are paying rent as well as mortgage. But that rent is less than a market rent.

It's all rather academic to be honest - nobody made anyone buy a house on shared ownership terms, and the terms are not actually as unfair as the OP seems to think.

Air-Wolf_2

Potential shared owners are financially checked before being accepted to purchase by the Housing Association (HA) – they want people to be able to afford to live there. In addition it is made clear that they are responsible for all repairs and maintenance (accept for defects in the first 12 months of new builds). The only exception to this is apartment blocks where the HA may be liable for external items such as windows and roofs.

As a rule HAs buy in shared ownership properties from the builder/ developer at 80% of open market value, the initial 50% share bought goes towards paying the builder/ developer, the rental paid on the unsold equity (normally set at 2.75% of unsold equity) is used to pay down a mortgage/ loan the HA will of taken out to buy the shared ownership properties in, any future capital receipts collected from shared owners buying more of their property are used to fund further new build affordable housing i.e. social/ affordable rent and shared ownership. Basically the rent paid to the HA will be just enough to pay down the loans they have against the houses.

HAs can make profit but they can’t distribute to shared holders etc, it is ploughed back into the provision of further homes or improvement to their existing housing stock.