Shared ownership (good or bad)

elgar_2

Ok...Im going to try not panic..
But I am about to buy SO (25%), new build. However when I do the total, rent and mortgage will be less than I could rent for. I have had discussions with solicitor (I live in Scotland) and he has bought and sold many SO properties without a problem.

I wouldnt be able to have my own home any other way as my income doesnt increase vastly (nhs worker) and property prices are still going up here..

I obviously dont know how it will all work out, but sometimes you just have to take a chance and for me it is about having a home. If property goes down well I will just have to see what happens but Im only taking one step at a time with this..

Sorry for waffle..not used to this 'foruming'

E

willsonline

couldn't agree more with 'elgar'....

Sometimes you just gotta go for it, what happens happens. Some people are saying wait 5yrs as market conditions may be more favourable???

Excuse me? 5yrs is a long time to wait for your first home and there is no guarantee of a better deal.

I know of 1 SO scheme where i live thats offering 1 bed flats for 10k off the Market Value price, so they are not all overpriced, just do your research!

Will

purple12

I have a Shared Ownership property. I'm very happy with it. I am paying less than I was in rent and living in a -much- nicer and bigger place. I needed somewhere to live and could never have afforded a place otherwise so it's worked out really well for me and I've been here a few years now.
I think you just have to look at what's best for you.

redrabbit29

Richard_Webster wrote: »

I think that we need to distinguish between:

1). a general problem with new builds on the one hand (which tends to be magnified for SO because HAs get stuck with agreeing high prices with the builder) and

2). the benefits of shared ownership in principle to help people get on the "ladder"..

Of course people going into shared ownership need warning that SO newly built or converted SO properties can be overvalued, but this isn't a fair criticism of SO as a concept.

Good point.

I have the option of either:

25% deposit/equity loan on a new bulild, OR

up to 50% equity loan for a deposit on any home on the open market.

Any thoughts on that? Appreciate everyone's help.

ixwood

willsonline wrote: »

couldn't agree more with 'elgar'....
..
I know of 1 SO scheme where i live thats offering 1 bed flats for 10k off the Market Value price, so they are not all overpriced, just do your research!

Will

Who sets the "Market value price"? I may be a cynic, but that's sounds a bit naive to me..

I wouldn't touch a SO with a barge pole. They're invariably overpriced, more hassle and less profitable.

Although if it was a straight choice between renting and SOing only, then SO would probably win. If we weren't at the end of a 10 year property boom of course.

ruggedtoast

purple12 wrote: »

I have a Shared Ownership property. I'm very happy with it. I am paying less than I was in rent and living in a -much- nicer and bigger place. I needed somewhere to live and could never have afforded a place otherwise so it's worked out really well for me and I've been here a few years now.
I think you just have to look at what's best for you.

And this is the bitter irony of SO. The more successful the scheme, the more people its designed to "help" are priced out. Lets look at it another way:

"I built a dozen first time buyer flats at cost price of about £40,000 per unit. Now FTBs in this area can afford around £80,000 for this type of property, a profit of only 100% for me. Thanks to Shared Equity I can sell these properties for £160,000 each, half of which is paid for by the buyer, and the other half by the tax payer. Thanks Shared Equity!" A. Developer.

scooby1001

I did shared ownership way back in 1996 and we could buy any house on the open market as long as we paid 50% of it. At the time there was no way we could afford any other way so we did and we were very happy there. The only downside to it was the fact that as house prices rose so did the cost of buying the other 50% and we would have never been able to buy the whole house. When we had to sell it was a nightmare but that was in 2001 so things have proberly changed since then. I think if you can get shared ownership to buy on the open market rather than on one of those new build estates, and afford to buy a house with one bedroom more than you currently need it could be a good idea.
Especially if you think you might never be able to afford a home outright

CYBERCIDERSAVER

wymondham wrote: »

i dont see many properties advertised with SO that are not new builds, just an observation...

That's possibly due to the fact that you have to allow the agency that owns the other half to look for someone to buy your part. sometimes it's 28 days (ours it's 8 weeks) As they are quite sought after they get snapped up before they hit the market.

For us it made sense. We had our second child and our 2 bed rented house just got far too small. Our 50% mortgage is about £500 and our rent on the other half is £170

To rent something similar would be £575+ so although we are paying more than renting we are paying off some equity in it... well we would be if prices weren't falling. but we are in it for the long term.

I see the rent as SOME of the interest we would be paying if we had 100% I am going to overpay by 100-150 on the mortgage a month so see it as a way of getting a very cheap mortgage. Perhaps my maths is shot and someone will point that out to me (be most welcome)

Also the house is stunning (for a shared ownership) I have never seen a resale SO property that within the last 18 months has been completely redecorated throughout with a drop dead gorgeous kitchen and bathroom.

The only thing to be wary of is staicasing. It cost in solicitors fees and valuation fees everytime you do. Personally I am going to wait until when (and if) I can afford all the other half and do it in one go.

Helga14

I love my shared ownership flat. I brought a flat that previously was rented by the housing association so it isn't new build. They re painted the whole flat, new (cheap) carpets and lino throughout, a new (cheap but workable) kitchen. I could only afford ex-la flats on estates in areas I didn't want to live in on the open market. My housing assocation sold me the flat about £40k less than anything I could find similar in the area so I got a very good price. It is worth looking into. I would avoid very big developments. Look into the valuation very carefully. Also if you're in my situation your neighbours won't understand that the housing association won't just fix your boiler if it breaks down.

It can be a very good thing. I would try to buy as much of the place as possible to start off with. I have just staircased and it was a slow process and not cheap. I'll have to staircase once more to get the whole flat. I would suggest you try to buy somewhere not so expensive that you will never be able to buy the whole thing however that may not be practical if you have a family etc.

wymondham

I think SO schemes could mask the true problem with housing - houses cost too much, so with SO it increases the buying power of people to purchase these properties - does this really benefit society in the long run, or fuel the problem ?