To staircase or not to staircase (shared ownership)

Sukiboo

Hi, I’m looking for a bit of advice on our shared equity house. 

We have a 45% share, we pay £630 pm mortgage and £370pm rent. We’ve been here for 2 years and bought it from new (5yr fixed rate mortgage, and house valued at 250)
we are looking to pay off some debts and move within 5 years to a fully owned home but we wonder if it’s best to staircase this one to fully owned first or not, and just sell it in as a shared equity home. Does anyone have any advice? 

amandacat

I had a shared ownership house. I had difficulty selling it on. The housing association had 28 days to find me a buyer before I could advertise it with an estate agent. They didn’t get me a single viewing in that time, the extent of their advertising was publishing it on their website. But if they found me a buyer I was expected to pay a % of the house sale to them as a fee and they expected me to do my own viewings. 

You also have to pay for a RICs surveyor to value it and it must be sold that price. 

After the 28 days I was able to use an estate agent but it still had to be sold at the valuers price. I got lots of viewings but then they have to make an application to the HA- the process takes ages and several people applied who weren’t accepted or couldn’t get a mortgage. After several months of waiting we gave up and staircased to 100% and obtained the freehold and stayed in the house for a further 6 years before selling it. Turned out to be the best thing we did as we built equity in the rest of the property, were able to sell on at our chosen price with no housing association involvement and the process was much less painful. 

My experience doesn’t mean you’ll suffer the same but if you’re staying for another 5 years and can afford to staircase you will build the extra equity and might find selling easier. But do your research eg how desirable will your house be to buyers as if you think you might struggle to sell you might find it easier to sell it as shared ownership but be prepared for the sale to take longer than usual. 

Petriix

Now is a good time to borrow. Either staircase to 100% or don't go above 50% as anything between is hard to sell on.

Doodlebugs

Petriix said:

Now is a good time to borrow. Either staircase to 100% or don't go above 50% as anything between is hard to sell on.

Agree. Shared ownerships are typically for those struggling to get a big enough deposit and/or mortgage for buying outright. So if shares are over 50% but not 100% then it’s typically more difficult to sell. 

We staircased to 100% and found it easy to sell as we didn’t have to deal with the HA. They had a clause that they wanted first refusal if we sold within 21years but in reality they never buy back. So we were able to sell at whatever value we wanted. 

If you’re looking to move within 5 years it may well be worth staircasing as you keep any extra equity from when you own 100%. Shared ownerships locally are struggling to sell at the moment, though that may well change once the furlough help and stamp duty relief changes. 

amandacat

The good news is they’re no longer allowed to add the clause where you have to give them first refusal to buy it back once you own 100%. 

Cloudx12

I had email from HMLR and said that it is not their policy to enter reference of staircasing in the title register and nor would be required.

(Note: I have my 100% Mortgage Deed Copy) as I am became the sole Proprietor of the flat I bought from A2 Dominion. My previous solicitor applied for a charge AP1 as a Whole for Title.

Has anyone or your solicitor applied for an Update of  Title Deed to enter  100% Memorandum of Staircasing.

vic_sf49

@cloudx12, could you please start your own thread, or maybe wait until the land registry folk are in work, to answer you.

You've now posted the same thing 6 times, and resurrected some threads from 2021, and the original poster never returned...