Moving on from shared ownership

KMR1984

Does anyone have any experience of selling a shared ownership property?

We currently have a £47,000 mortgage on a 50% share of a shared ownership 2 bedroom bungalow.

Our income has grown significantly since we moved in 5 years ago and now we are looking to save up and move to somewhere bigger in the next 3-5 years. However, I am concerned about how easy it will be to sell a shared ownership property. The housing association have terms that mean they have 6 weeks to attempt to sell the property before we can market it ourselves.

When we bought it we had quite a difficult time getting a mortgage for a shared ownership, not helped by the fact we're both self employed. Has the mortgage process for shared ownerships gotten easier, or more difficult?

Would we be better placed to buy the other 50% of the property ourselves in the more immediate future and then look to sell it as a whole when the time comes?

Would be interested to know other people's thoughts/experiences.

gardener_A

We sold our shared ownership house and had many problems with the Housing Association. As you say they have a defined period in which to try to find a buyer themselves. Unfortunately they failed to advertise it with information about the applicable restrictions on who would qualify to apply to buy – very strict local residency and affordability. Hence we had so many wasted viewings by people living up to 40 miles away or unemployed with no hope of getting a mortgage. This was very frustrating as we had already had an offer accepted on our next house and could not advertise it ourselves until 6 weeks had passed. The HA were very difficult to deal with and had no sense of urgency to process their side of the deal and then continued to collect the rental element after we left – this took weeks to get back.


If you can afford to buy the remaining 50%, I would definitely do that first, at least then you get the full benefit of any increase in value including the cost of your own improvements.


Although it was the only way we could buy our first home at the time, and we did well in the early 2000s property boom, it was very frustrating that the HA benefited from the value we added with our refurbishments. Our small estate was a mix of rented and shared ownership properties and when the rentals had new windows, kitchens, exterior paint etc, nothing was offered to the shared owners.
Good luck with whatever you decide!

KMR1984

Thanks for your input gardener!

This is my main concern - we'd wait, try to sell our half, fail and possibly have to go through the process of buying the other half anyway in order to move forward.

The only positive I can think of is that I know the HA already have a waiting list for these properties. They are of a high standard and unique to the area. How helpful this will be when the time comes is another matter though. We would be the first in the street to attempt to move on.

bellaboo86

Some friends of mine have had one big nightmare trying to sort out selling their shared ownership home and has resulted in 1 buyer pulling out. I think that buying the other 50% now would make life a lot easier for you for when you do want to move.

AMILLIONDOLLARS

I have to report a positive experience. My daughter has just sold her Shared Ownership Flat and now has a 3bed.

For her, the process was relatively simple and faster, all within 6 months! She does live in Central London, so I think this did help.

The HA supplied the buyers and she sold within the week it was listed on their website, she had quite a few people through the door. They vetted the buyers on their finances and chose the eventual buyer. Everything went smoothly. The valuation was slightly down on market rate, I suspect that this contributed to the quick sale, but on the upside, she has got a house that will certainly increase in value over the coming years, so swings and roundabouts. She also got a decent deposit to put down on the house. Fees for selling through the HA were 1% of her share, not the whole thing. She had to pay their costs, including the Managing Agent's Report around £210 which will be needed and their solicitors fees, fees varies according to the HA you are with. In her case it would not have been worth stepping up, she wanted a house.

I am reading that in stepping up, valuations come in higher than when you want to sell.

londonbabe73

Just mid process in selling my s/o my HA are useless refused to let them sell as they wanted 1% of the whole value even though I only own half kicked up a stink threatened to go to my MP as think that's it was taking the Mickey . But happy to say went to an EA and sold my 50% share in 2 weeks for £10k over the HA valuation. People knock S/O but its enabled me to step up the ladder and get my own non S/O place so can't complain. HA approved my buyer in approx 10 days so fingers crossed we are pushing ahead.

adibaba

@londonbabe73 - I agree, charging a percentage on FMV is an outrage.

adibaba

Also, @londonbabe73 - how much were the estate agent's fees?

Thanks

Hillbilly1

Other posters on previous threads have advised when selling S/O to not staircase. You then narrow your market to only those that can afford the higher initial price and outlay.