Selling Shared Ownership

frenchie89

Hi,
I currently own 30% of a Shared Ownership property and have never staircased up. We now intend to sell (and hopefully quite quickly as we have a baby on the way so can't afford to have an empty flat).
The property is currently on the market and has had a lot on interest at full value, rather than the 30% share (presumably from developers). The SO company are happy for us to sell at 100%. (The property has been marketed at 30% with a buyer who then dropped out, so we are past the 8 week period).

Does anyone have experience of doing this:
-  Did you have to get a new valuation to sell at 100%? Or were you able to put the property up at whatever price you wanted?
- Who covered the additional stamp duty fees of staircasing up to 100% and selling on the same day?
- Any pitfalls I should be aware of?

Many thanks,
K

frenchie89

Bump ...

x

sharhar

Hi, I did sell my shared ownership flat by staircasing and selling on same day.

You can market the property for any amount you want. But the HA will accept only the value provided by a RICS surveyor. Say if the RICS surveyor valued your house at 100k and if you sell for 110k, you will keep the full 10k difference + 30% your share. The downside to this is if you sell the property for 90k, then you have to bear all the loss. The housing association will still expect to get their 70% share of the value provided RICS surveyor.

 I did not pay any stampduty on the staircase. Obviously the buyer would have paid the stamp duty buy i didn't have to for the staircasing part.

No specific pitfalls but many people don't understand Shared ownership. One of the buyer pulled out when he got to know this is a shared ownership house even though it wouldnt have made any difference to them. So be prepared for everything

frenchie89

Thanks Sharhar, that's good to hear.
I think we will be able to cover our additional stamp duty costs if we can sell the property at more than we've had it valued at. OR to ensure the stamp duty costs are paid to us by the buyer on completion date. 

When selling the property at 100% share, the HA need to ensure that the valuation is current and this valuation lasts for 3 months only. So I need to make sure that the valuation is A) still correct, and I'm asking them what happens if the sale process takes longer than 3 months and the valuation changes.

Did your property sell quicker than when selling as a share? 

Thanks

sharhar

No it took almost 5 months for us sell due to a buyer pulling out. In that case you will need to get a updated desktop valuation by the same RICS surveyor that did your original valuation. They charged me around half the price of original valuation for this desktop valuation.

frenchie89

Hmm HA are saying they need to commission their own RICS surveyor! Seems suspect, considering they are all independent and unbiased?! I've questioned it ...

5 months is very good - we had a buyer toy us along for 11 months

newsgroupmonkey_

frenchie89 said:

Hmm HA are saying they need to commission their own RICS surveyor! Seems suspect, considering they are all independent and unbiased?! I've questioned it ...

5 months is very good - we had a buyer toy us along for 11 months

If they're RICS, they're RICS. Makes little odds who instructs them. When they value, there are a number of things they have to do - which includes using comparables. They have a small percentage either way (and it's very small) to play with value wise, but they're not going to be able to rip you off, nor is it in anyone's interest to do so.

frenchie89

Thanks, we've just commissioned another RICS surveyor to complete a third valuation so that it's in date.
Sharhar, did you have to commission another valuation when yours expired after 3 months? Our HA is saying the sale has to complete with the valuation being valid for only 3 months... seems crazy to me when we know that 3 months sales aren't really happening recently.

sharhar

Sorry just saw this. I didnt have to commission another surveyor. The same surveyor who did the initial valuation did another desktop valuation (without visiting the property) and I was able to use it. The charge for desktop valuation was almost half compared to the initial valution

Rach273

My first buyer pulled out and then we went into lockdown so i didn't complete until 13 months after my RICS survey. My housing association didn't require a new valuation, and were happy to use the original.