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Shared ownership - should we staircase?
HanPop
Posts: 185 Forumite
Hi, just want some opinions 
Myself and my partner have a 75% share in a shared ownership preoperty, which we have had a positive experience with. It is a 3 bed house purchased in 2013 and we currently owe £85,000 on the mortgage. We are due for an inheritance of around £75,000 and wondered whether we should pay that off the mortgage (and pay a penalty) or purchase the other 25% share (around £40,000) and then use the rest to overpay the mortgage. I think we will move in the future as we have two small children and are considering a third. If we purchase the remaining share we will have the freehold and the housing association will cut all ties. My question is when we come to sell in the future is it easier to sell a 75% house (lower deposit) or do you think people will think that they can nearly afford 100% of a house and so will wait and save up and go for that over shared ownership?
Thanks
Myself and my partner have a 75% share in a shared ownership preoperty, which we have had a positive experience with. It is a 3 bed house purchased in 2013 and we currently owe £85,000 on the mortgage. We are due for an inheritance of around £75,000 and wondered whether we should pay that off the mortgage (and pay a penalty) or purchase the other 25% share (around £40,000) and then use the rest to overpay the mortgage. I think we will move in the future as we have two small children and are considering a third. If we purchase the remaining share we will have the freehold and the housing association will cut all ties. My question is when we come to sell in the future is it easier to sell a 75% house (lower deposit) or do you think people will think that they can nearly afford 100% of a house and so will wait and save up and go for that over shared ownership?
Thanks
0
Comments
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this was discussed only recently, obviously there is no "correct" answer as each case depends on its own precise facts. Have a read:
https://forums.moneysavingexpert.com/discussion/5685033
you may like to consider:
- the closer you get to 100% the fewer people are interested in buying an SO as by definition if they can afford, for example, 80-90% they are likely to be able to afford 100% and this can buy somewhere that is not SO to start with
- 75% is so close to the 80% boundary at which the Stamp Duty applies to further staircase purchases that you may as well just jump to 100% and have done with it0 -
Thanks for that, I will read the thread. I did think by having this large share I may price some would be shared owners out but it's what they deemed us eligible to have at the time. Although the benefits have been only paying £112 rent. Buying the rest probably seems the more sensible option anyway as it means we don't have to pay the rent anymore (only one wage coming in) and frees up a bit more money per month whereas if we paid a chunk off the mortgage (about £65,000 after clearing debt) we would still be on a 5 year fix so would still be paying the same per month for that time when I'll still be off work with the children0
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