rent on shared ownership

Bevn

If i buy more shares in my shared ownership house is the new rent payable calculated on the current house value or is it just reduced in relation to what I am now paying?

I currently own 1/4 of my house which is  valued at 260000 and pay rent of £680.

Hope that makes sense

Altior

You pay a part of the rent proportionate to your equity share %.

So the full rent is 906.67. 906.67 * 0.75 = £680. ie you pay 75% of full rent.

If you purchased another 30%, it would be 906.67 * 0.45 = £408. ie you'd pay 45% of full rent. 

Bevn

I get that but if I staircase would the rent be on the current valuation as it has increased

Altior

Bevn said:

I get that but if I staircase would the rent be on the current valuation as it has increased

It's based on the rent, ie if you were renting only. Then discounted for the proportion you own.

eddddy

Assuming your Shared Ownership is with a Housing Association...

I guess you're asking...

• When you originally bought the property, the base rent was set at maybe 2.75% or 3% or whatever of the property value at that time.

• (The base rent has been increasing at RPI+1% or whatever, since)

• Now you're staircasing and the property has been revalued, you're asking if the base rent will be reset at 2.75% or 3% of the new valuation

If so, the answer should be "No - the base rent will not be reset". Only the percentage you pay will be reduced.

(Your lease should explain about how rent is calculated - and so the lease should confirm this.)