Shared ownership

Elfbert

I bought a few years ago - as far as I remember I went and viewed the property, liked it, and then got in touch with the HA who went over my eligibility on the phone. (I was coming out of rented, though, not selling!) As far as I know, most places will be fine as long as you've sold your old property (in your case to your ex) before buying the SO property. Buying can take a bit longer because solicitors have to get documents from the HA, the owner, the Freeholder, if that's different to the HA, etc.

I'm in London, so obviously property prices are bonkers, but I'm in the same boat as you - SO, even with the conveyancing costs, rent/service charge and mortgage payments was considerably cheaper than renting, with the agent's fees, high rent payments etc. But I was lucky in that a family member did my conveyancing quite cheaply, and the property price has steadily risen given me quite a lot of equity. I would definitely research what it's like in your area - look at the sold prices of any recent SO sales compared to the price it was bought for etc.

Sadly buying and selling properties is never without stress, I don't think!

Kynthia

I think you really need to look into this before assuming that shared ownership will be cheaper than renting. Shared ownership is designed for those that need security of a permanent home yet can't afford to buy and can't move to a cheaper area. It works best if staying for a long time as selling is difficult, potentially expensive and time consuming, plus they don't always increase in value as much as other properties. So not good for short term or someone hoping to gain equity quickly.

There are application and buying costs, the mortgage and rent, repairs and maintenance, ground rent and service charges, then the very large lump sum to extend the lease. Then when selling you'll have to pay normal selling costs such as a solicitor, but also the HA will make you pay for a valuation survey and pay all their fees for finding you a buyer and their solicitor fees.

Shared ownership has its place such as for people with children and jobs in an area where they can't afford to buy but need more security then being forced to move every couple of years by landlords and intend to stay for 10 years, it can be great. Are you sure it's your best option?

csgohan4

Nothing wrong with renting as you don't need to push yourself to the limit when buying/ mortgage.

Hutchch0920

The leasehold renewal is a cost to be looked into and factored in.

From my understanding SO costs are not dissimilar to any other leaseholder, the only key difference being the rent element? Can anyone correct me on this?

The link that was posted does have a very good pros and cons list. One that I had not considered is the HA's requirement For the next buyer to be local. Most of the SO properties around me have this buyer requirement which is a frustration buying wise. The suggestion to look at how the value has changed for SO resales is also great, I am going to take up this suggestion too.

I am 27 and have so far spent £40,000 on rent over 9 years. Yes I had a roof over my head but imagine if I had been in a position to invest that money in a property....and one day be able to gift that value to my children or grandchildren or use that money to retire? Rather than handing it over to a landlord. Perhaps it's just me but that option seems much more favourable than handing it over to someone I don't know and them getting the long term value of it instead. And if shared ownership or Help to Buy scheme is the only way I can afford to buy in Kent then so be it.

Tugaville

I would find out how much it would cost to extend the lease before purchasing this property, because of the Marriage Value fee

IMO Shared ownership especially in London is better than long term renting, I leave you with this...

What is best 20-50% of something or 100% of nothing?

Have a great day everyone :j

csgohan4

Tugaville wrote: »

I would find out how much it would cost to extend the lease before purchasing this property, because of the Marriage Value fee

IMO Shared ownership especially in London is better than long term renting, I leave you with this...

What is best 20-50% of something or 100% of nothing?

Have a great day everyone :j

Either way you have 100% liable for repair costs for both inside and outside the property whether you like it or not, art or full ownership

SaveSomeMore_2

clairewych wrote: »

Wow Andy way to be unhelpful when OP is clearly feeling down on their situation already!

I don't think he was being unhelpful, in fact I think given this is such a major decision the OP needs to hear all the facts.

I too think S.O can be a bit of a scam.

In my area it is typical to see flats and houses for £100K for 50% equity when they probably would only cost <£150K to buy outright.

When you factor in interest when you are paying off that 50%, rent you would still have to pay, and then the fact you would need to start all over again to get the remaining 50% if you wanted full ownership overall in some cases you can end up paying twice what a property is worth. In one instance when I did the math I would have paid well over £200K for a £120K flat! There are some serious sharks out there in the SO world really chasing people in vulnerable financial positions.

Not to mention they can be notoriously difficult to sell meaning people can end up stuck there in the future. So I think Andy is right the OP needs to really look into whether it is a good deal in their location, and work out the figures.

Personally, as difficult as it is in this market I would say rent in the short term and build up a deposit for a cheaper freehold property you can own fully.

In the short term it is slightly more expensive (as you will be paying high rent and not banking anything) BUT a. you won't be tied down long-term, and b. when you do buy you have something that is easier to sell, that you are paying market value for, and is all yours (providing you don't default of course!).

Tugaville

My opinion regarding Shared Ownership only relates to London, due to the rapidly increasing prices.