Shocking Shared Ownership Deal

missionfella

Hi everybody

I've been looking for an affordable place to buy in London (yes, another one) and one of the options i've been looking at is Shared Ownership. I currently live in Westminster so not much comes up. This is one of them. I just can't can't believe the terms of it. I thought at first it must be a misprint. I know it's central London but SO is meant to make it more affordable. The deposit they're asking for is the bit that shocks me most - which first time buyers have access to all that money????!!!!!

The whole thing seems ridiculous to me and I'm surprised it hasn't caused massive controversy.

http://www.octavialiving.org.uk/assets/0000/0881/17_Cleveland_Street__-_W1_-_Final_Affordability___Price_List_05.06.15.pdf

http://www.octavialiving.org.uk/find_a_property/homes_to_buy/75_cleveland_street_w1_-_shared_ownership

This can't benefit anybody.

mildredalien

Who on a £32k income, struggling to buy a house in London, has a deposit of ~£90k that they'd be willing to blow on a 25% share of a flat??

missionfella

mildredalien wrote: »

Who on a £32k income, struggling to buy a house in London, has a deposit of ~£90k that they'd be willing to blow on a 25% share of a flat??

I know, i just don't get it. Do they think because they offer lower rent for the lower income bracket that it's a good deal?

alchemist.1

mildredalien wrote: »

Who on a £32k income, struggling to buy a house in London, has a deposit of ~£90k that they'd be willing to blow on a 25% share of a flat??

Someone who has been gifted the money by their parents but cant afford a mortgage for anything in central london.

This sorts of places prop up due to the proportion of of the building to be reserved for affordable housing/shared ownership as a condition for planning permission.

brit1234

I can afford the deposit but I would rather chop my nuts off than go for a shared ownership scam scheme.

These schemes aren't affordable but designed to push up house prices under the false illusion of affordability. They have highly restrictive conditions, they have a huge range of extra fees like when you stair case, you don't technically own, rent goes up bu RPI like the service charge when your wages are limited to cpi or lower.

They are a scam, avoid at all costs.

Pixie5740

What FTB on an income of £32k would be trying to buy something valued at £780k+ in Westminster though? The phrase "cut your cloth accordingly" springs to mind.

The developer is probably obligated to provide some shared ownership properties no matter how ridiculous the terms might seem. Maybe some senior Westminster council officials will help their offspring buy them using a huge gift from the Bank of Mum & Dad.

Willem-de-Blois

This sounds like a great opportunity for an MP's son or daughter on between 29-32k secretarial expenses p.a.


The small print assumes a mortgage rate of 3.5% which I would think would be optimistic for a FTB looking at a less risky arrangement.


I think 4.5% would be more realistic and when the resultant mortgage is added to monthly service charges and sinking funds, the debt to net salary ratio is will squeezed to get under 45%