Shared ownership

Wheems

I am thinking of buying a shared ownership property - Is this a good idea?. The theroy looks good. However I am told that they are impossible to sell and that you never really get to the point of owning the property and also that not long after you move in rent/service charges on the other half go up quite quickly. A work colleagues partner who has some knowledge has told me not to bother.
Anyone had any experience?

Hump

Read the agreement carefully and read Richardson v Midland Heart 2008 for what can happen if you default on the agreement

heidir

we are just in the process of buying the other 50% of ours... we did buy a resale so not in a new development, and we've been here 9 years, we couldn't get on the property ladder without doing it this way. It has worked for us... i think you have to look at it and think will i stay here forever? Do i eventually want to own this property?ive heard trying to sell is difficult... another thing to consider is do you get the freehold if you buy it completely with free rein to sell on with restrictions. As i say it worked for us but lots of research is my tip

Hoploz

I started off with a shared ownership first home. I bought 70% and went on to 'staircase' and own the rest of it. It worked brilliantly for me - gave me the first step I needed as i was single and starting out as a teacher, and in the end I made quite a big profit on it by the time I sold it 5 years later and bought a house with my husband.

However, this was not a new build on a housing association estate. I would think rather differently about that. I was able to purchase a normal flat which was older and an ordinary privately owned block, so I was able to sell it on very easily.

Loopy28

My first house was shared ownership and I have no regrets.

My rent/service charge increased each year but this was calculated based on inflation and was only ever about £7 month increase each year.

The house was valued accurately in my opinion and sold really quickly. I would've staircased to full ownership but I moved area.

It got me on the property ladder and allowed me to have a lovely 3 bed house for about £500 month in todays money between my mortgage and rent.

I never experienced any of the horrors that you hear of!

Wheems

Thanks for yours views - Is there a difference when it is a Housing Association who owns the rest? Rather than private owner

kingstreet

Wheems wrote: »

Thanks for yours views - Is there a difference when it is a Housing Association who owns the rest? Rather than private owner

That isn't possible. The other owner has to be a registered social landlord, which is usually a housing association.

Hoploz

Yes, I meant that my flat was in a standard ordinary block. The shared ownership was between me and my local housing association. So when I staircased to own 100% of it my flat was no different to any others on the private market, I'd just had a hand to buy it.

I think this system is best for resale and maintaining a normal valuation if you can find a scheme in your area, compared with a specific housing association block or estate.

nobodysdriving

I can't really say much as I am buying a shared ownership/new built flat and waiting to move in any day now (so can't say how good/not good owning one is), however I can say that for me the sale was very straightforward (both with HA and mortgage) apart from of course the usual couple of hiccups with full mortgage application (when they asked for documentation I was not expecting to be asked but solved it of course).

The HA has been quite good and efficient so far, the price seems right for this type of property in the location (similar private flats are priced similarly)

The ONLY pain right now is that the HA has not built these flats and they are waiting to 'take over'/complete on the development, EVERYTHING has been done, it's all built and working (all light bulbs are in order, the door entry is done blah blah blah), however it is DRAGGING like h**l, the HA is as frustrated as us waiting to move in, they have now imposed a deadline beyond which the developer will get big fines for not being ready to hand over.

I hope the HA tells me on Monday what this deadline is as I am sure the developer will get their finger out by then and hand over!!!

Just to add: I am buying to 'stay put', I am not considering in the slightest way to move out. I have moved in excess of 40 times in my life, I am now 45 and would like to 'rest my bones'!!!!
am buying a 50% share and am planning on getting onto the other 50% in the next 4 to 5 years, I have (hopefully) a job promotion coming my way in 2 to 3 months.

Loopy28

When I had my shared ownership house, if I had staircased to full ownership I could have the freehold. If I decided to sell, I had to give the housing association first refusal to buy it back, with the value determined by my choice of RICS valuer. If they chose not to then I could sell on the private market just like any home owner.

stator

If you can afford a house without shared ownership, then I would do so, even if it's not in your ideal area or size.
If it's your only option then it's worth considering.
You're right there are a lot of fees and charges to be wary of. If you think you might need to move in a year or two I wouldn't bother with shared ownership. Really it's for the long term.
Selling can be a pain. The fees can be high, both service fees for the shared areas but also fees for valuations when you want to buy extra shares and fees for selling can be high too.
Also remember you don't own the whole house so you can't do very much with it. No extensions or pets without permission from the landlord.
However you are responsible for ALL Repairs to the property, so you don't even get the good bit of renting.