Shared Ownership - Can you choose how much Deposit you put down, even if you have more Savings?

Leggitte

I am getting on really well with my shared ownership. It was a new built and I had 12 month 'warranty' on all defects in the house, which would be corrected for free. I made good use of this, and everything I had flagged up was repaired to my satisfaction. People on this forum will say that shared ownership is the most expensive way to buy a house. This is correct, but with due diligence, shared ownership can be great. 

I put down a large-ish deposit for my £250,000 house and only pay a small mortgage. Together with the rent I pay roughly the same  (within £10 a month) what I paid when I was privately renting before I moved into my shared ownership, and I have twice the space and no private landlord who's agent does 3-monthly check-ups. 

I have been there 2,5 years now and both rent and maintenance have gone up each year, although only by very small amounts. Rent went up by £2.00 a month and maintenance from £17,50 to £18,75 a month. No nasty surprises here. 

Scorpiogal13

Leggitte said:

I am getting on really well with my shared ownership. It was a new built and I had 12 month 'warranty' on all defects in the house, which would be corrected for free. I made good use of this, and everything I had flagged up was repaired to my satisfaction. People on this forum will say that shared ownership is the most expensive way to buy a house. This is correct, but with due diligence, shared ownership can be great. 

I put down a large-ish deposit for my £250,000 house and only pay a small mortgage. Together with the rent I pay roughly the same  (within £10 a month) what I paid when I was privately renting before I moved into my shared ownership, and I have twice the space and no private landlord who's agent does 3-monthly check-ups. 

I have been there 2,5 years now and both rent and maintenance have gone up each year, although only by very small amounts. Rent went up by £2.00 a month and maintenance from £17,50 to £18,75 a month. No nasty surprises here. 

£250,000 for a House?! Wow.

Couldn't even get a 1 Bed Flat for that in London. Lol

But it's great to see that Shared Ownership can work out for some people.

I guess it depends on your Housing Association and whereabouts in the UK you choose to live.

Lou76

Leggitte said:

I was in this situation a couple of years back. The HA wants you to buy the largest share you can afford. However, as mentioned above several times, the HA does not know how much savings you have. In my situation (54 at the time of buying, on my own) I realised that I would probably not be able to staircase to 100% and decided for the smallest share (25%) and stay there, so if/when I do sell I have a better chance of selling. If you own 75% and you are trying to sell a shared ownership, you have a problem. People who can afford to buy 75% shared ownership can most likely also afford the mortgage on a freehold.

Leggitte, just checking if you've made sure that you can "rent" indefinitely?

The reason I ask is, I bought my 25% share 9 years ago, via a private sale.  In saying that, the HA still ran checks on me to make sure I was suitable...🥴

Anyway, the reason the previous owner was selling up was that she had reached the 19 years "tenancy" period that meant she had to either sell up, or staircase to 100%, and she couldn't afford to staircase.

Granted, it's on my deeds stating this (which I read properly after buying), but if she hadn't told me, I would be none the wiser.  Neither the solicitor or HA told me, or if they did, I wasn't taking it in at the time.

Just wanted to check you don't have similar rules, wouldn't want you having a nasty surprise. 🙂

I appreciate different HAs will have different rules.

Tokmon

All schemes are different. The scheme i know about don't care how much deposit you pay as long as it is enough to satisfy the mortgage provider. 

They also only allow you to buy around 50% equity and don't allow staircasing but don't charge any rent on the part you don't own so ends up being a far cheaper way of living compared to fully buying a property or renting and there is no limit on how long you can stay living there.

Scorpiogal13

Lou76 said:

Leggitte said:

I was in this situation a couple of years back. The HA wants you to buy the largest share you can afford. However, as mentioned above several times, the HA does not know how much savings you have. In my situation (54 at the time of buying, on my own) I realised that I would probably not be able to staircase to 100% and decided for the smallest share (25%) and stay there, so if/when I do sell I have a better chance of selling. If you own 75% and you are trying to sell a shared ownership, you have a problem. People who can afford to buy 75% shared ownership can most likely also afford the mortgage on a freehold.

Leggitte, just checking if you've made sure that you can "rent" indefinitely?

The reason I ask is, I bought my 25% share 9 years ago, via a private sale.  In saying that, the HA still ran checks on me to make sure I was suitable...🥴

Anyway, the reason the previous owner was selling up was that she had reached the 19 years "tenancy" period that meant she had to either sell up, or staircase to 100%, and she couldn't afford to staircase.

Granted, it's on my deeds stating this (which I read properly after buying), but if she hadn't told me, I would be none the wiser.  Neither the solicitor or HA told me, or if they did, I wasn't taking it in at the time.

Just wanted to check you don't have similar rules, wouldn't want you having a nasty surprise. 🙂

I appreciate different HAs will have different rules.

Hmmm, very iffy.

Thanks for the info Lou76.