Shared Ownership question

homeless9

Say you buy a 50% share of a Shared Ownership house for £100,000....so the valuation is £200,000.....

A few years pass and the house has tanked in price to £150,000 due to Brexit....

So £75,000 is yours and £75,000 is the housing associations.....

So in this situation....if you had a lot of cash sitting in your bank, you could take out further % shares in the property and take advantage of the drop in price......have housing associations been known to get funny when people have taken out further % shares after a big drop in house prices, especially if you are looking to pay off a large % at once? or is that just part of the game and they accept it?

Sibz

homeless9 wrote: »

Say you buy a 50% share of a Shared Ownership house for £100,000....so the valuation is £200,000.....

A few years pass and the house has tanked in price to £150,000 due to Brexit....

So £75,000 is yours and £75,000 is the housing associations.....

So in this situation....if you had a lot of cash sitting in your bank, you could take out further % shares in the property and take advantage of the drop in price......have housing associations been known to get funny when people have taken out further % shares after a big drop in house prices, especially if you are looking to pay off a large % at once? or is that just part of the game and they accept it?

Is this in England/Wales or Scotland? Is it related to HTB?

Sandyra

I think it’s as you put it, part of the game, just in the same way if there was a property boom. Having it a valuation survey by a RICS surveyor as part of the staircasing process ensures that the HA agrees to that current valuation.

I’ve benefited from the fact my property has dropped in value by £10,000 since my last staircase, so buying the last 25% won’t be as costly. The HA have had to accept that’s the current climate. So by the end of the year I’ll have staircased to 100%.

Cakeguts

If you have mortgage to buy the original £100k and it is more than £25k you will be in negative equity because the mortgage will be for more than the amount that you own in which case the mortgage lender might want you to pay something towards the negative equity before you buy more of the property.