Shared Ownership Experiences

Mr_Curious

Hi Guys,

I'm looking for peoples experiences of shared ownership properties. Typically NOT new ones. Due to a change in my circumstances I find myself looking for a place to live. Buying outright by myself is not an option unfortunately. However shared ownership is.

What are the pros and cons of this type of arrangement. I have done a good bit of research into this but I'm looking for first hand experiences just so I am not over looking anything.

All replies appreciated.

Thanks in advance,

Mr_C

wordsearch

We went with a five year old shared ownership flat, and are very happy with it. It's a two bedroom flat in London and we pay much much MUCH less than we were paying to rent, and less still than if we had a full mortgage.

The downsides are that we don't know how much service charge is going to be each year though to be fair that is true with any apartment with a service charge - and in our case, it hasn't actually changed, so isn't actually a problem. The communal garden isn't the best cared for and I don't quite see where the money for that has gone, but again that's not really shared ownership specific.

You're limited in where will give you a mortgage and our bank were a massive pain.

But, we have a flat that we like for a price that we can afford and we get all the joys of painting and renovating (redecorating at the moment!) it as we see fit!

teddysmum

wordsearch wrote: »

We went with a five year old shared ownership flat, and are very happy with it. It's a two bedroom flat in London and we pay much much MUCH less than we were paying to rent, and less still than if we had a full mortgage.

The downsides are that we don't know how much service charge is going to be each year though to be fair that is true with any apartment with a service charge - and in our case, it hasn't actually changed, so isn't actually a problem. The communal garden isn't the best cared for and I don't quite see where the money for that has gone, but again that's not really shared ownership specific.

You're limited in where will give you a mortgage and our bank were a massive pain.

But, we have a flat that we like for a price that we can afford and we get all the joys of painting and renovating (redecorating at the moment!) it as we see fit!

Don't forget future bills for maintenance that you are responsible for.

teddysmum

IP,continue your extensive search in here , as there are lots of threads on the topic.

IAmWales

My first property was SO. It allowed me to buy in an area I couldn't otherwise afford. The rent + mortgage was far cheaper than full rent or mortgage on an equivalent house. Rent increases were inflation linked. When I sold I was allowed to do so on the open market and the first viewers bought it. It was sold (and purchased) at a fixed price, which I liked as it takes out any uncertainty.

One recommendation would be to get a good, local solicitor, so they can go through the lease with you. That way there are no nasty surprises later.

wordsearch

teddysmum wrote: »

Don't forget future bills for maintenance that you are responsible for.

Yes, well done. Believe it or not, we were aware of these.

saajan_12

Haven't done it myself, but here's a few pitfalls of shared ownership to be aware of


1) Worst of both worlds (renting / owning) in a sense: can't just move on a months notice as you can with renting, but not all yours to do as you please with freehold ownership.

2) Will the SO company contribute to maintenance / repairs / improvements? If not, you're paying 100% of costs for 50% of the property value gain.

3) Restrictions on who you can sell to (limited to the SO market, and you may have to give first refusal to the company). This can limit how much you get back, and increase timeframe if you need to move on due to life changes.

4) IF you are expecting life changes, remember house buying/selling is expensive and stressful, so any money saved over renting outright can be lost if you have to move within a couple of years.

5) Rent portion can be increased, knowing you are fairly 'locked in' as it's a big hassle for you to move and sell your share.

6) Price of the remaining 50% share can be increased knowing you are fairly 'locked in' to wanting to staircase up on the same property.

purrsuede

Hey Mr_C, just wondering if you came to a decision about shared ownership in the end?

>> Your deposit will be a percentage only of the share you are buying… Probably a fraction of what you’d have to pay if you were buying on the open market.

>> You will be exempt from paying Stamp Duty if you share is valued at under the minimum threshold.

>> The lower initial outlay means you can buy a bigger property than you might have otherwise been able to afford, in an area that might have previously been out of your reach.

>> Your combined monthly mortgage and subsidised rent repayment will often be less than if you were to rent privately.

>> You can build up the share of the property you own until you own it outright. You will consequently be investing in your new home rather than simply paying rent.

>> You will have all the benefits and security of being a shared ownership leaseholder.

To get a feel for the types of properties and prices/deposits available, you could check out a couple of shared ownership portals?

Moat Homes focus more on houses for sale in the south east if you're looking in and around that area, then there's websites such as Property Booking which looks to list nationwide properties