Unsure what to do!

samps1973

Hi,
I'm nearly 48 years old and am in the early stages of looking into shared ownership. 
I earn £35,000 pa and have £15,000 in savings.
The reason for wanting to buy a share in a property is for a bit of security for when I get older and also as to leave something for my daughter when I die. 
All I've done so far is filled the form out on the help to buy site for my area and they replied saying i qualify for shared ownership.
The next step i think is to contact a financial adviser or mortgage broker?...Theres so much info online it's hard to know where to start. 
The biggest worry for me is knowing what would happen when I get older. If say I have bought a 25% share on a 2 bed flat and am just about to enter retirement, how would the rent get paid? As I will have worked all my life will the housing benefit pay for the rent on the 75% that the housing association own. Also is there a go to place online i can use that show the steps i need to take.
I currently pay £650pm all Bill's included on a 1 bed Studio flat and want a 2 bedroom place so my daughter can stay at weekends in her own room as she's getting older. 

Thanks
John

MovingForwards

It's an independent mortgage broker you want.

You're responsible for the rent throughout life. Have you looked at your pensions, and state pension, to see what they will potentially pay when retiring? It's also worth putting your details in a benefit calculator to see what you'd be entitled to under current rules.

Remember with shared ownership you're responsible for paying 100% of the repairs.

Can you not look further out and buy a whole property, commute to work and then only have to worry about repairs and maintenance in retirement?

While a 2 bed property would be nice, a 1 bed with a sofa bed for occasional guests might be easier to achieve.

TBagpuss

If you are still in a shared ownership property when you retire then, if you were eligible, you would, assuming that benefits rules remain similar to what they are at present,  be able to to claim Universal Credit (or Pension Credit) to help with the cost of rent for the percentage of the property the HA owned, just as you could if you were in a wholly rented property. 

However, you are still 20 years from retirement so it's entirely possible that you might be in a position to move into a wholly owned property at some point in the next 20 years, or indeed to downsize once your daughter is independent, and buy a smaller property outright.
I don't know how many shared ownership properties there are in your area - being eligible doesn't automatically mean that  there will be a suitable property available - you may have to wait a while.

Have you looked into buying without shared ownership? What sort of prices are 2 bed flats in your general area? 

samps1973

Thanks for the replies. Theres some good food for thought there.
The main reasons I thought about going down the route of shared ownership are firstly I'm nearly 48 and thought shared ownership would be the only route I could take. If I am able to buy 100% I would much prefer that. The only thing is I live in Reading which is quite expensive and would like to stay close to where my daughter lives to take her to clubs etc. The other reason is i only have £15000 for a deposit and all the expenses, i thought by maybe getting a £70000 mortgage or a 25% mortgage the deposit would be smaller and possibly the fees too. I know theres a lot of negatives about shared ownership but if it's the only route available it must be better than paying 100% rent but maybe not.

I think from reading your comments I'm going to now aim for a 100% mortgage on the cheapest property possible. I think if I had a shared ownership property after a good few years I guess you would feel trapped where as 100% theres more freedom. If I'm unable do that though I'll take a step back and go for the shared ownership route or some other available route that I'm not aware of.
Now I'm thinking shall I use the comparison tool here for mortgages and get a quote? or would it be best to contact a mortgage broker? Or just contact Barclays who do both shared ownership and 100% mortgages. I was thinking about using London and country mortgage broker as they charge the fees to the banks when the mortgage is complete I think. What do you think?

Thanks again for taking the time to reply.
John

Anyanka1

Hi John,

I think you would do well to investigate your options further before making any decision, starting with looking at other, cheaper areas.  I admit I don't know how it works with shared ownership; it may be different but hope you realise that, if you buy a flat outright, it will almost certainly be in a block:  If you are in England (or Wales, I think) it will be leasehold and you will be liable not only for the cost of your own repairs but also for your share of any and all communal repairs, such as the roof.

May I ask, is there any reason why you feel the need to buy a property now?  Perhaps things might improve in the near future, who knows?

From what I have read on here, shared ownership is a last resort, I think, and best avoided if you can find any other option.  At least, if you rent, you have the flexibility to just move after giving one month's notice (not that I advocate renting if outright ownership is an option)

I wish you luck and hope you will update when you have news.

samps1973

@Anyanka1   Sorry not sure how to use the quote. You asked if theres any reason which I feel the need to buy a property now?
Thanks for the reply!
I am now completely debt free and have some savings for a change ...paying my Landlord £650 a month seem a lot to pay when I could be putting that money to something I will eventually own or part own. I've also recently started worrying about where I will live when I'm older and lastly to leave my daughter something. I know that its hard to get a private rented place when your unemployed as nobody wants people on benefits living in their home and I'm assuming it will be just as difficult to find somewhere to live if I was say given notice to leave where I'm living due to the landlord selling up etc when I'm old and retired and only receiving state pension. If I don't do something about it now I don't think I ever will

Runningmad

We looked at shared ownership but found more negatives than possitive. We are now using the help to buy scheme. Have you thought of this if you are a first time buyer? 

samps1973

I just done an online mortgage quote with Natwest bank who I bank with. After putting all the figures in based on £35,000 a year 
If I put a £10,000 deposit down they would lend me £140,000 so a total of £150,000. That would be ideal if I was buying a property up north. If I didn't have my daughter to think about I'd move there. Over 20 years it would roughly be £1,150 per month.
Back to the drawing board 😀

samps1973

Thanks @Runningmad
I had a little look into it. I remember it said something about the government paying 20% toward the equity (whatever that means ) or something like that but I think it said it was coming to an end soon so I brushed it aside unless I'm thinking of something else. I only thought about the sharedownership as I'd heard of it before. I'll dig a little deeper about the help to buy.
Thanks

Anyanka1

I understand your sense of urgency but do not think your primary motive should be leaving something to your daughter.  Many, including myself, are not privileged to be born to wealthy parents and material considerations should not be the main factor in any relationship, IMHO.  Why not think about what is best for you?

samps1973

That's a fair point. I'm in the same boat as yourself. Being the eldest of 8 children and brought up by a single mum, treats were few and far between and so were clothes.
It's not just leaving her something, it's nice to have a room for her when she comes to mine. At the moment she sleeps on a blow up mattress and has done for 7 years. as I only have a room and a bathroom. Shes now 11 and a pain in the butt 😀 so could do with her own room. Friends have said she'll probably be at the age where she won't want to come to mine. But at least there would be a room if she needed it as she gets older. Also be nice for family and friends to stay over etc. If I pay privately for a flat it would cost me a fortune. I wouldn't mind paying a £1000 or more a month if it was mine as it's an investment. All im doing at the moment is paying someone else's mortgage, annoying!