FTB cannot decide - studio or 2 bed shared ownership??

go4it

In a bit of a pickle.

FTB, looked at loads of places.

Got 3 options.

1. 2 bed apartment in an up and coming ex industrial area. 50% would cost 69K, or could buy 75% for 102K, have to pay rent and service charge on top. Area is nice, council have plans for it but every property developer on earth is building flats there. these flats are nice and are by a river, but are not massive.

2. studio apartment (340 sq feet) in a conversion of an ex steel factory. no parking, would cost 78K. cannot see studio as not built yet, buying off plan

3. forget both of them and keep on looking!

I'm not sure of the shared ownership thing. Like if I bought 75% and then deciced to sell, there will be people selling with 50% and 75% or even 100%, what will buyers choose???

anyone got any words of wisdom?!

jennifernil

340 sq feet is very small. How big is the 2 bed apartment?

go4it

Not sure on exact measurements for 2 bed - but it has open plan kitchen and living room, a good sized bathroom, 2 bedrooms (room for double bed, not massive rooms), and 1 bedroom has en suite shower room + toilet.

roswell

whats your plan for the future ? eg getting married and having kids in the next 2 years could mean buying a flat is pointless

Spangled

The first property I bought was a 290 square feet flat which I lived in for three years - so it can be done! However, it was actually a converted studio so was in fact a one bed (bathroom, bedroom and open-plan kitchen/lounge). I valued having a separate sleeping area rather than a separate kitchen. I looked at some bona fide studios but felt like I would be living in a hotel room.

Also, with the shared-ownership 2-bed flat, you have the option of renting out the other room to a lodger/mate to help with your mortgage. Plus there's the option of buying an increased stake in a year or two's time.

MJMum

Also, with the shared-ownership 2-bed flat, you have the option of renting out the other room to a lodger/mate to help with your mortgage. Plus there's the option of buying an increased stake in a year or two's time.

I agree entirely. Plus, in a falling market you can't give studio flats away, so you may not be able to move when you want to in the future. Much better to buy a shared ownership 2 bed IMHO - you can "upgrade" to a more expensive property (by buying the other 25%) without moving. Although you will need to double check (a) can you buy the rented % at a later date and (b) can you sub-let the spare room if needed.

Bargain_Rzl

Spangled wrote:

Also, with the shared-ownership 2-bed flat, you have the option of renting out the other room to a lodger/mate to help with your mortgage. Plus there's the option of buying an increased stake in a year or two's time.

Be careful about planning to get a lodger. Most SO flats, to my knowledge, have a clause in the lease which forbids any kind of subletting.

And as for increasing your stake in the property - it's worth remembering that this is not the only option. You could increase your stake - perhaps right up to 100%, which should mean it is easier to sell for a good price in future - but there is also the option of paying off the mortgage on your initial stake and just staying there on a minimal rent for as long as you like. This could be handy if, for example, you wanted to (or HAD to) take a pay cut for some reason - or go back to college. I moved into my flat in November and I won't know which of these I might want to do until a couple of years down the line. At the moment I am just saving as much as possible to pay off the mortgage early.

zag2me

Bargain_Rzl wrote:

Be careful about planning to get a lodger. Most SO flats, to my knowledge, have a clause in the lease which forbids any kind of subletting.

That doesn't stop you doing it, you can rent rooms to whoever you want. I know loads of people who do this.

In my experience I bought a studio apartment and it has served me well. But trying to make the jump up to a 100% owned 1 bedroom house, or 2 bed flat is very hard as the price difference is enormous(basically double).

With Hindsight, I should have started with a shared ownership flat and rented one of the rooms.

go4it

Thanks for the replies :T

I have opted out of the studio. it looks a nice development but there is no parking and it is city centre, hence any parking options will be like 15K a space.

At the show flat for the SO the sales woman did say that you could rent out a room, and that many people who have bought there have done.

Still thinking at the moment. I'm after a basic man pad, but somewhere I could easily sell should I decide to move elsewhere.