Shared Ownership - Opinions please.....!

TheSaint_UK

Hi all,

Hope I am posting this in the correct place!

We (my wife and I) are looking into the possibility of moving into a shared ownership property. Without going into too much detail (yet, anyway) it seems to be our only way of affording a bigger house (Me, my wife, our son & another on the way in May!).

Does anyone have any opinions/warnings/recommendations that I would do well to bear in mind whilst looking at this possibility.

I will go into more details on our situation if need be, but basically a combination of existing debt, our wages & my wife working part time means that I think this is going to be our only option.

We desperately need more room, and a garden for our children.

We have just accepted an offer for our current house and so really need to decide the way forward.

Grateful for anything you can add...

Dan

BitterAndTwisted

There have been countless numbers of threads on this forum about shared-ownership/shared-equity. The overwhelming consensus is that they are not a good deal. Can't sell properties because the prices are too high to be affordable to people on a "normal and modest" salary? Sell them 25% or 50% of a property. Brilliant!

You need to examine very, very closely any offer that you receive. Some "buyers" have found that they acquire the responsibility for 100% of repairs and maintenance for a property they only own a percentage of. Plus, sometimes there's no cap on rent-increases and stair-casing can be more expensive than you first thought it may be. Reselling can be difficult and for values that would make your eyes water.

Please tread very carefully!

DannyboyMidlands

If you cannot afford a bigger house then you cannot afford a bigger house. End of story. Shared ownership is a scam. Do not do it.

kelpie35

I had a shared ownership house a few years ago and had horrendous problems when trying to sell it.

I certainly would not recommend you get involved with this, but that is my own personal opinion.

Good luck with your search for a new home.

TheSaint_UK

Wow! Didn't realise they were considered such bad news! If I put these options forward, what would be your answer....

1) Jump off the property ladder entirely having been on it for nearly 6 years and rent a larger house
2) Move into a Shared Ownership house, therefore staying on the ladder (just)

Dannyboy, the word Scam seems rather strong. Surely it is a reasonable ( but certainly not perfect) solution?

I am very grateful for all feedback.

BitterAndTwisted

You will most likely read of some people's favourable experiences with shared-ownership, many of whom are very happy in their properties, which I'm sure they are. Some of the serious disadvantages only become apparent when you come to sell at a later date.

They do appear very attractive when you think that it's the only way to acquire a property large enough to satisfy your wants in the short--term. People do get very cross on here when they appear to have made up their minds and some of the nasty pit-falls are pointed out to them.

You do what you think is best for you and your family in the long-term.

BitterAndTwisted

[QUOTE=TheSaint_UK;494725191) Jump off the property ladder entirely having been on it for nearly 6 years and rent a larger house
2) Move into a Shared Ownership house, therefore staying on the ladder (just)[/QUOTE]


There is no "property ladder"! There is only home-ownership. For some people this alleged ladder has transmogrified itself into very long and nasty snake.

rodenal

You really need to think of the future when looking at these properties as has been stated above - you'll find that they are simply vastly overpriced and no discount will be forthcoming as there will always be someone wanting to move in with little/ too low a deposit.

Compare the full price of the property on offer with the asking price of similar sized properties in the local area (and this is just asking, who knows what actual selling is, up to 10% or more less in some cases) then work out the excess you are paying for said shared ownership property. In 5/7/10 years time should everything go well with your job and other circumstances etc will you have paid enough off the property to be able to sell and retain some form of deposit for the next place or will you be left with an excess?

Ignore the potential fluctuations in property market going up or down for the minute, assume it stays stable, in 5 years time how much will you have paid off and how much would you get back if the property sold for the asking price of similar houses now?

BitterAndTwisted

If you have an hour or two to waste you could consider doing an "advanced search" on this forum for threads with "shared-ownership" or "SO" in the thread title and see what comes up.

This subject has been discussed at length on here for some time. Some good experiences and some bad depending on whether they have tried to re-sell or not. If you're never going to stair-case or sell it could all be OK for your family.

Martin81162

We had a shared ownership flat for 4 years and moved into our house with a "proper" mortgage earlier this year. We did not have any problems selling. Once the valuation was done it all went smoothly. Shared ownership was a means to an end for us.

TheSaint_UK

BitterAndTwisted wrote: »

They do appear very attractive when you think that it's the only way to acquire a property large enough to satisfy your wants in the short--term.

BitterAndTwisted, thanks for all the help you have offered so far on my query. I have quoted the above and am genuinely very interested why you mention 'in the short-term'. If you have the opportunity to buy up to 100% of the property eventually, is it not also a decent (but again, not perfect) solution for the long term?

I really do not mean to come across as arguing with you, so apologies if it seems that way. I am genuinely eager to learn more because, as you mentioned earlier, I need to ensure what we do is best for the whole family. This is a massive decision for us and I want to make it having considered all details.

For the record, the house we are looking at this scheme for is a three bed semi detatched house and is not a new build (saw the newbuild thing mentioned alot after searching on these forums).

Thanks again to all,

Dan