Shared Ownership Rental Increases

ThomasKn

I bought my Shared Ownership home 5 years ago, I purchased 30% & rent the other 70% from a housing association, a solicitor was appointed by them & we had endless problems, it took 6 months to go through & was so traumatic I don't think I could ever go through it again, when I moved to the property in 2014 the rental portion came to £260pcm which yes I thought was more than reasonable & as a single parent the only way I would ever get onto the property ladder.


Every year the rental portion is reviewed & goes up by about £20 which is 6% so now my rent is up to £380. I have spoken to the Association in question & they were very blas! about it saying oh yes well over the years it may double again & will keep going up year on year, I tried to explain to them that at some point this will become unaffordable & un-saleable, they suggested I found a family member to buy them out (staircase) or do that myself or if that wasn't feasible...sell up, the whole attitude felt like they did really give two hoots & they said they were following & within Industry guidelines, so I then contacted Financial Conduct Authority who said they wouldn't handle rentals side & pointed me to Money Advice Service which was also a dead end, does anyone have any advice at all I'm in utter distress & turmoil

AdrianC

The annual rental increases will be specified in the lease.
By buying your share of the property, you agreed to be bound by that lease.
So... what does the lease say?

csgohan4

SO is scam imo, foot on the property ladder is a gimmick for SO, own less and yet responsible for 100% of maintenance, more expensive as well

Did you expect your rent to not increase? what does your lease say about rental increases?

I think the rent will be the least of your concerns

https://forums.moneysavingexpert.com/discussion/5969284/shared-ownership-housing-association-are-poor-landlords

https://forums.moneysavingexpert.com/discussion/5928753/shared-ownership-question

Lunchbox

6% sounds high, ours is RPI + 0.5% and it’s rare for an SO lease to be more than RPI +2%. What does your lease say about the annual rent increases?

ThomasKn

I have no problem with it increasing & to be honest I expected it to go up but not quite the rate it is, I went back through all paperwork from the Solicitor who was less than useless & I can't find a copy of the lease in any of the paperwork.
Everytime the renewal letter comes through its says "RPI plus 1%, or 6%, whichever is the higher" so I understand that's why its going up by 6% each year, now they say this is industry standard so who controls/governs/oversees this they must be regulated by something/someone?

AdrianC

If you can't find a copy of the lease, then spend a few quid and get it from the Land Registry's website.

If your lease really does say the higher of RPI+1% or 6%, then the time to object to that was before you bought, by voting with your wallet.

Lunchbox

ThomasKn wrote: »

I have no problem with it increasing & to be honest I expected it to go up but not quite the rate it is, I went back through all paperwork from the Solicitor who was less than useless & I can't find a copy of the lease in any of the paperwork.
Everytime the renewal letter comes through its says "RPI plus 1%, or 6%, whichever is the higher" so I understand that's why its going up by 6% each year, now they say this is industry standard so who controls/governs/oversees this they must be regulated by something/someone?

It is governed by your lease - you really need to get sight of a copy. You will have been provided with a copy before exchange as you will have had to sign it. I’d be surprised if a solicitor did not additionally draw your attention to this specific clause in your lease when they sent a title information pack to you before exchange. Unfortunately if this clause is in there, you agreed to it so you have no recourse. 6% minimum annually is not industry standard, 0.5-2% above RPI is.

MARVEL

We have been in a shared owernship since 1997. Our rent increases by rpi or 5% whichever is greater as stated in the lease. Our rent was originally £148 And now is £330 . We own 50% of the property. As a mortgage has an end date where you can see an end the rent will only get higher. We have contacted councillors and the housing association. The only reply we get is "it is what it is" we cannot afford to buy the second half as the house has quadrupled in price. As they say one hell of a catch this catch 22.

DaniY

ThomasKn said:

I bought my Shared Ownership home 5 years ago, I purchased 30% & rent the other 70% from a housing association, a solicitor was appointed by them & we had endless problems, it took 6 months to go through & was so traumatic I don't think I could ever go through it again, when I moved to the property in 2014 the rental portion came to £260pcm which yes I thought was more than reasonable & as a single parent the only way I would ever get onto the property ladder.

 We should do something, because this is outrage because every year rent is increasing.
The flat is not increasing in price I don't   understand this increase.
Evan is an explanation that is "RPI+1% or 6%" I don,t think  the increase is fair.
Government said sharing ownership is an help for first time buyers but in time look like is a scam.

• We should do something, this is not right 

MARVEL said:

We have been in a shared owernship since 1997. Our rent increases by rpi or 5% whichever is greater as stated in the lease. Our rent was originally £148 And now is £330 . We own 50% of the property. As a mortgage has an end date where you can see an end the rent will only get higher. We have contacted councillors and the housing association. The only reply we get is "it is what it is" we cannot afford to buy the second half as the house has quadrupled in price. As they say one hell of a catch this catch 22.

you are so right