is shared ownership a good idea?

olympicsmummy

I have £70 000 deposit buy my salary is only £12000. I am considering purchasing a 2 bed flat in horsham. The flat is apparently worth £200 000. I would purchase a 30% share for £60 000 which I would purchase outright. I would then have to pay rent on the share I dont own which would be £320 (and £113 service charge) as it is a leasehold property.

Does anyone have any good/bad experience of shared ownership please?

jaylee3

Shared Ownership can make it very very hard to sell in the future, andin many cases, the tenant/owner is responsible for repairs. In fact the owner of the property - or should I say part-owner - does very little, except reap the rewards of the property increasing in value.

Can you not go for something much cheaper? You could almost buy a flat outright with £70K in most parts of the UK.

I would avoid part ownership like the plague. There are very few advantages, and more pitfalls. I know a few people who did it, and bitterly regret/regretted it.

olympicsmummy

Thanks Jaylee.. I would much prefer to own outright but I've looked at flat prices (I have to have a 2 bed flat as I have a child but can be a small flat)... I cant see any flats for less than around £150000... on my salary of £12 000 I can only get a mortgage of say around £50000 so thats a total of £12000... i live in horsham and there are no flats in or around this area for this price :-( I really dont know what to do! Maybe help to buy loan??

BitterAndTwisted

Mortgages, rents and service-charges have only one direction in which to go and you know which one that is. On only £12k per annum I can't see how you will be able to afford it.

I'd rather rent than get sucked into a scam like shared-ownership

toniq

olympicsmummy wrote: »

I have £70 000 deposit buy my salary is only £12000. I am considering purchasing a 2 bed flat in horsham. The flat is apparently worth £200 000. I would purchase a 30% share for £60 000 which I would purchase outright. I would then have to pay rent on the share I dont own which would be £320 (and £113 service charge) as it is a leasehold property.

Does anyone have any good/bad experience of shared ownership please?

Are u looking at that new estate Kilnwood vale? between Horsham and Crawley? I was looking at those a few days ago.

Our budget is alot bigger than yours as a family, we steered away from that new estate as the route into Crawley/Horsham will be horrific espec at rush hour.

Have you looked at Crawley? it's still very expensive not as bad as Horsham though

HAMISH_MCTAVISH

olympicsmummy wrote: »

is shared ownership a good idea?

It can be, depending on individual circumstances.....

On the scale of private housing good to bad, IMO shared ownership is better than private renting, but not as good as owning the whole place.

The advantages are that you are no longer at the mercy of private landlords, and therefore have more stability. The entry costs are typically lower than buying a whole house. And you can usually do more to make the place feel like your own than you can in private rented.

The disadvantages are that they can be hard to sell, the long term costs are higher than 'normal' ownership, as you're paying rent as well until you staircase up to 100%, and the terms of ownership/residency are often more restricted than with something you own 100%.

But this bit....

on my salary of £12 000

.... Makes me wonder why you would think of buying anything at all in the area you live in currently?

You could fairly reliably earn that little money just about anywhere in the UK, and be buying a house outright with your current deposit in vast swathes of the country....