Taking advantage of an unmortgageable shared ownership?

kingstreet

An HA will base value/price on a RICS valuation paid for by the purchaser so I'd think carefully about spending a few hundred to find out the surveyor won't put a value on it in present condition.

foxy-stoat

I see where the OP is going...if it comes back at £0 value based on a mortgage valuation then the HA should just sign the remaining 50% over to him, thus removing their liability to replace the cladding.

When the issue of the cladding is addressed then the OP will have to fund 100% of the flat's share, seems like a bit too risky and doubt the HA will sign over the remaining ownership for nothing, and I doubt they will be able to do that anyway without sorting the cladding first.

AdrianC

foxy-stoat wrote: »

if it comes back at £0 value based on a mortgage valuation

But £0 on a valuation is simply a lender saying "We don't want to know". It doesn't mean the property won't sell for even £1 to anybody. Of course it will... And if it'll sell for £1, how about £1,000? £10,000? £100,000? It's all a sliding scale of reduction on the unfettered, unblighted, mortgageable market value.

As has been said before - there's a lot of unmortgageable "cash buyer only" places on RM. They aren't all "free, just come and collect the keys".

kingstreet

It won't be a £0 valuation.

It will be a 'no valuation'. They will simply not value it until essential repairs have been completed.

No HA is going to give away taxpayer-funded social/affordable housing stock.

Lunchbox

foxy-stoat wrote: »

I see where the OP is going...if it comes back at £0 value based on a mortgage valuation then the HA should just sign the remaining 50% over to him, thus removing their liability to replace the cladding.

When the issue of the cladding is addressed then the OP will have to fund 100% of the flat's share, seems like a bit too risky and doubt the HA will sign over the remaining ownership for nothing, and I doubt they will be able to do that anyway without sorting the cladding first.

Shared ownership service charges aren’t ‘shared’ with the Housing Association; the OP will have to shoulder 100% of their property’s share of the cladding replacement cost regardless of the proportion they own.

A mortgage valuation of £0 does not mean a property’s value is £0, it’s only unmortgageable as it isn’t suitable security for a bank to lend against. It would still have a value at auction/cash purchase etc.