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Shared Equity / New Build
pioneer22
Posts: 523 Forumite
Hi, I have put up a few questions now about this is my situation thus far, we are nearly exchanging contracts. I am buying a new build house for 148k 70/30 HBD its a 3 story 3 bedroom 3 bathroom house, its walking distance 20 mins to Leeds city centre 5 minute drive or 10 minute cycle (its on a cycle route straight into town) just slightly past Clarence Dock for those of you who know Leeds.
I hear lots of stories of people falling into negative equity because of these schemes/and the fact new builds have a premium attached but there are apartments minutes away in Clarence dock that are 2 bedroom which are 150k and very small. I have been told that a house new or old will do what the markets will do.
The idea if we fell into terrible negative equity would be to carry on what I am doing and save 20k in the next few years. Then after a bit buy another house which would be a permanent family home as the one we are buying is great but not near any schools etc. And rent the new build out then if it does drop in value the rent is covering the house.
I hear lots of stories of people falling into negative equity because of these schemes/and the fact new builds have a premium attached but there are apartments minutes away in Clarence dock that are 2 bedroom which are 150k and very small. I have been told that a house new or old will do what the markets will do.
The idea if we fell into terrible negative equity would be to carry on what I am doing and save 20k in the next few years. Then after a bit buy another house which would be a permanent family home as the one we are buying is great but not near any schools etc. And rent the new build out then if it does drop in value the rent is covering the house.
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Comments
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I can't help you on whether or not to buy, but you are looking to buy into a scheme. With that, comes pitfalls.
One of those pitfalls is it totally ruins your idea to rent it out at a later date. You won't be allowed. Not unless you own it outright at that point, and you don't mention that, you only mention saving 20k and buying another house with it.
In a way I can see where you are coming from, but in another way, greed is taking over and you are not looking into things properly.0 -
We can sublet it as a whole unit not individual rooms the solicitor halifax and the agency have all confirmed we can do this, what im trying to do is find a way to protect ourselves if we did fall into negative equity.0
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Anyone else?0
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I think that the answer is when you fall into negative equity rather than if.... If you think think this will happen then why not rent and buy when prices have fallen, possibly then without a scheme, opening up all options for the future?
You compare prices, but remember that those who buy off you will also benefit from this price difference....0 -
How does my plan sound?0
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its shared equity. Its a bit like throwing a jar of molten dogshit over Edvard Munchs 'The Scream' and asking "How does it look??"0
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If you were talking about shared ownership, you'd be spot on. In this case, it's shared equity and the property is owned by the purchaser from day one.Graham_Devon wrote: »One of those pitfalls is it totally ruins your idea to rent it out at a later date. You won't be allowed. Not unless you own it outright at that pointI am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0
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