Htb vs SO - how do you compare them?

Ybe

Is help to buy better than a shared ownership scheme where the rent on the unowned share is charged at 2.1%?  How do you compare which is a better deal? 

moneysavinghero

I presume you mean HTB Equity Loan vs Shared Ownership.

With the equity loan you will own the house. Just you. No one else. To me that already makes it a better deal.
With shared ownership as the name suggests someone else owns part of it and you beholdent to them to some degree.

Try this calculator if you want to compare what each scheme will cost you.
https://www.helptobuyagent3.org.uk/help-to-buy-schemes/mortgage-calculator/

Runningmad

We started off looking at SO but was put off with more negatives than possitives. So we looked at equity loan and it's the only way for us. OK there are negatives but at least you own the whole property (when you've paid the loan back) and there's no rent to pay. The only other draw back is the new builds are very over priced but depending where you live they maybe more reasonable (we live in the south east). Another point that is a little off putting is because of the demand being high we are having to buy off plan and that is a bit daunting. I'm not an expert in any way but as we've already started the process I maybe able to answer any questions you have.
Good luck. 

Ybe

Runningmad said:

We started off looking at SO but was put off with more negatives than possitives. So we looked at equity loan and it's the only way for us. OK there are negatives but at least you own the whole property (when you've paid the loan back) and there's no rent to pay. The only other draw back is the new builds are very over priced but depending where you live they maybe more reasonable (we live in the south east). Another point that is a little off putting is because of the demand being high we are having to buy off plan and that is a bit daunting. I'm not an expert in any way but as we've already started the process I maybe able to answer any questions you have.
Good luck. 

That’s great thanks. With the SO properties I’ve seen, there’s an option to buy 100% of the property. 

I think I am also leaning towards htb but yes, they are very inflated. Did you get any sort of deal with yours? Discounts or incentives? 

Runningmad

Yes you can buy 100% of SO but each time you staircase you have to pay your fees and the housing associations fees, also when you get to 100% you don't always get the leasehold transferred to freehold.
Regarding our situation the sales guy said when there is high demand and you buy off plan there isn't any need for them to offer insentives, if there is a finished property they need to sell that's when they offer insentives, although saying that he said there is a chance of some upgrades to be included roughly 1% of purchase price. 

getmore4less

What is the exit plan?

With H2B ideally you need to have a plan that works by around year 5 or soon after once the interest kicks in to either buy out or ride it through to sale.
Check the rent on the SO is it fixed or escalating.

The comparison is relatively easy once you have the numbers.

Make the starting point the same throw the same amount at both over a period see which leaves you owning more of the property.

Ybe

getmore4less said:

What is the exit plan?

With H2B ideally you need to have a plan that works by around year 5 or soon after once the interest kicks in to either buy out or ride it through to sale.
Check the rent on the SO is it fixed or escalating.

The comparison is relatively easy once you have the numbers.

Make the starting point the same throw the same amount at both over a period see which leaves you owning more of the property.

I think the difficult part is predicting the increase in rent and equity loan interest. Both rise in line with inflation but that could obviously vary. In terms of exit plan, I think h2b is easier to get out of as you can just sell on the open market. With SO, the housing association has a lot of control over the same process. The down side as someone mentioned before is that h2b properties are massively inflated.