silly question but pse help !!

where2start

Hi we are first time buyers and have found several houses in Bletchley, Milton Keynes area that are reasonably priced but most of them are 40% shared ownership by a housing asociation , could anyone with more knowledge of this please explain to me what this means, would buying the property been a problem in future etc. ? ? ? secondly is it true that this area is a bad area to invest in ? ?

dannyboycey

The Fenny area of Bletchley is a good area to invest in. The houses are comparitively low priced to the rest of MK at the moment and the area has undergone a lot of regeneration over the past few years - and with the arrival of the new MK Dons stadium, there will be a lot more future investment in the area.

dannyboycey

As far as the shared ownership goes, you hold a 40% share and pay 'rent' on the other 60%. The positives are that it makes it easier to get on the property ladder - the downside being that you will only get 40% of any profit on the house (or loss!). It is my understanding that the housing association will offer you the opportunity to purchase an extra percentage yearly (I think 10% but I may be wrong on this), eventually being able to purchase the full 100%.

where2start

thanks for that what about the fact that most of the houses been sold at 40% - 60% ownership by a housign association ? could you explain what exactly this means

Tiger_greeneyes

Shared ownership is where you buy x% of the property - the housing association own the other x% - and you pay them rent on their share. It's an affordable way to get on the property ladder, but remember you'll also be paying rent.

The house price advertised will doubtless be the value of the x% available to buy. For instance, in a 50% shared equity deal where the house is worth £100k on the open market, the house will be advertised for sale for £50k. That's why the house prices seem so reasonable.

where2start

thanks think we posted replies at the same time thanks again !!

maninthestreet

Can't tell you much about shared ownership, but I lived in Bletchley for 8 years before moving away 10 years ago. I lived on the Racecourses Development in Far Bletchley, and house prices have rocketed since I left. I sold my little 2 bed terrace (not shared ownership) for £37500, (I bought for £54000) but they now go for about £130000.

where2start

having done extensive research on the prices in and around Milton Keynes Bletchlet seems to be far lower on the prices !! any suggestions as to which areas are good and safe we have two children ages 9yrs and 3yrs !!

RufusFrog_2

I am moving out of Bletchley next week. Although lower priced than some areas the prices have moved in step with everywhere else - our house has more than tripled in value in 10 years. Also there are more amenities now (IKEA and Asda and the football stadium) and a lot of regeneration money has been spent on the centre recently so I see no reason not to buy here now.

Some parts are more desirable than others. The Lakes Estate is obviously one to avoid but there are some nicer adjacent areas that you might feel are vulnerable to e.g. yobbish behaviour - I know someone who lived on a nice road just to the South who always felt afraid to go out at night.

I live on the West Bletchley/Far Bletchley side, on Buckingham Road (which commands a premium despite being quite busy - go figure). The estates to the South of this road are mostly nicer than the ones to the North (with the exception of the area around the golf course). However the area where I live (the Western end of Whaddon Way) has a lot of (ex-)council housing but has always been trouble free and is great value for money.

I don't have kids so can't say much about schools. Of the two lower schools near me the Catholic one has 'Outstanding' throughout its Ofsted report, but Chestnuts is more at the 'Good' level. With Upper Schools the Lakes estate school (Leon) is not particularly academically succesful, and the West Bletchley one (Lord Grey) is middling academically but supportive. If you go a bit further North you can get into the catchment area of Shenley Brook which has some of the best results in MK. Very bright kids can also get into the grammar schools in Aylesbury and Buckingham. (There is a school bus to Buckingham that comes along my road, also I think to the private schools in Bedford, not sure about Aylesbury.)

Shared Ownership is quite 'mature' in Milton Keynes. My brother bought one in the early 1980s and it gave him a good start on the property ladder. A lot are traded on the open market without having to apply via the HA. However there is often quite a large and insidious 'premium', i.e. you buy say 50% of the property for x thousand pounds plus 5-15 thousand for the privilege! I don't know if this is at all negotiable but it's something to be aware of.

blackeberg

Our old flat was a shared ownership property so I can explain how it worked for us.

It was a newly built one bed flat in London and was valued at £66,500. We were able to buy 50% at £33,250 and then paid rent on the other half.

After a year in the property we had the option to buy the other half outright or to begin a process called staircasing (buying 10% at a time). This required a basic surveyors report which we had to pay for. As it was a Housing Association selected surveyor we had the right to appeal the first valuation and to select and pay for one of our own choosing. We eventually went through this process after about four years and bought the second half outright at £53,500. We therefore paid £86,750 in total.

A few thought on the financial aspects:

The Housing Association recommended several 100% lenders and seemed to assume that we wouldn't have a deposit. If we'd gone with their suggestions the mortgage would have been poor value.

Banks were not as happy to lend as we didn't own the property outright. Most of those that were wanted to lend at higher rates.

The Nationwide were fantastic as they offered us their normal range of mortgage deals. Based on the overall value of the property we still assumed that we would have to pay their insurance charge as we were borrowing 95%. They actually chose to view us as borrowing 47.5% of the property value so there was no charge.

We had the option to pay stamp duty on the whole property when we bought the first half. Worth doing unless you expect a property crash.

We were more than happy with the Housing Association's valuation when we bought the second half at open market value. We researched our area in depth and set a ceiling of £120,000. They valued at £107,000.

Staircasing could be quite expensive as you would need a separate survey each time. It could also be quite expensive to keep adjusting the mortgage if the bank wants to charge for a survey and admin fee each time.

When we finally sold it turned out that the solicitor who dealt with the second part of the purchase made a hash of the paper work. This made our buyer very nervous as it added a month to an otherwise very smooth sale whilst our outright ownership was registered in the correct place. I'd strongly advise using a solicitor that has experience of shared ownership purchases.

Any concerns we had that our sale value would be affected by the fact it was a Housing Association property were completely unfounded. We got the best price for a one bed flat on our road at the time.

RufusFrog_2

If the OP were to post some links to properties they are considering, we locals could offer some feedback on the location.