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Help needed- Shared ownership or back to back purchase?
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Darkangel
Posts: 537 Forumite
Hello,
I'm looking to buy a shared ownership property but am wondering if I should buy it outright instead (it's in London).
It is a resale, FMV (on the HA website) of £215K, owner is selling his 25% share. If I go the shared ownership route, I have enough savings to buy the 25% outright with no mortgage, so all I would pay is the rent and service charge to the HA (and my bills).
Would I be better off looking to buy 100% off the owner now (back to back) at the HA valuation of £215K, or just buy the 25% share and staircase up to 100%? The owner has already had Foxtons around to value the property as the 8 weeks was up and they valued it at £230K.
It probably is more obvious to buy back to back now, but the worry is that I would be sinking all my savings into that 25% share/deposit. I also work on fixed term contracts and have done since 2004. I can prove my earnings for the past 3 years and beyond, but I know this restricts the number of mortgage lenders that would be willing to give me a mortgage which is why I was thinking of going down the shared ownership route and then staircasing to 75% ownership (asking for less money on a mortgage), and then hopefully to 100%.
If I do it this way, will I need to get another valuation done so soon (HA says I can staircase after 3 months), and if they value it higher, say £230K, then I wouldn't be able to buy as bigger share as I wanted. I would have also purchased a property that was never within my budget (£215K is, £230K isn't). The service charges are another cost to factor too, it's £173 a month but this includes water and use of a gym.
Also, if I paid stamp duty now, would I have to pay more if the value of the property went up whilst staircasing?
I hope that makes sense, there's a lot going around in my head and I'm not sure if I've gotten it down right.
I'm looking to buy a shared ownership property but am wondering if I should buy it outright instead (it's in London).
It is a resale, FMV (on the HA website) of £215K, owner is selling his 25% share. If I go the shared ownership route, I have enough savings to buy the 25% outright with no mortgage, so all I would pay is the rent and service charge to the HA (and my bills).
Would I be better off looking to buy 100% off the owner now (back to back) at the HA valuation of £215K, or just buy the 25% share and staircase up to 100%? The owner has already had Foxtons around to value the property as the 8 weeks was up and they valued it at £230K.
It probably is more obvious to buy back to back now, but the worry is that I would be sinking all my savings into that 25% share/deposit. I also work on fixed term contracts and have done since 2004. I can prove my earnings for the past 3 years and beyond, but I know this restricts the number of mortgage lenders that would be willing to give me a mortgage which is why I was thinking of going down the shared ownership route and then staircasing to 75% ownership (asking for less money on a mortgage), and then hopefully to 100%.
If I do it this way, will I need to get another valuation done so soon (HA says I can staircase after 3 months), and if they value it higher, say £230K, then I wouldn't be able to buy as bigger share as I wanted. I would have also purchased a property that was never within my budget (£215K is, £230K isn't). The service charges are another cost to factor too, it's £173 a month but this includes water and use of a gym.
Also, if I paid stamp duty now, would I have to pay more if the value of the property went up whilst staircasing?
I hope that makes sense, there's a lot going around in my head and I'm not sure if I've gotten it down right.
0
Comments
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Will the HA allow you to buy 100%?0
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notsurewhereIstand wrote: »Will the HA allow you to buy 100%?
Yes, subject to the owner agreeing and finances0 -
*Bump*
Anyone???0 -
Just buy somewhere outright.Posts are not advice and must not be relied upon.0
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