Shared Ownership questions

[BullByTheHorns]

NCd for this as it's about my real life...

I live in a shared ownership house. I am aiming to pay off the mortgage for my 50% within the next 18-24 months.

What then?

• Get a new mortgage for the rest of it (guesstimate would be about £160k, on a 15 ish year term)
  
• Pay rent on the remaining 50% (which would be about £450/month). But that seems a little pointless - what happens to the bit I own?
  (* I have heard of a way that you can simultaneously buy and sell the last 50% at the same time, so you can sell on the open market immediately, rather than having to wait for SO buyers - and we live in a very desirable area and the house is definitely one of the best plots compared to the non SO houses, so that is something worthwhile considering!)
  
  Other considerations:
  
• Partner has come on the scene since I bought and any new mortgage would involve him (would get advice on how to document ownership etc)
  
• We might move but not for a good few years, and it would be to a lower cost area as well
  
  My final question is valuations - would the HA sell me the remaining 50% for the same price I paid at purchase or is it 50% of today's value (I think I can guess). Do they take offers? I haven't really had any contact with them since I moved in!
  
  Are there any professionals I can speak to that can help with all my options? Happy to pay for proper financial advice as long as it is tailored to me/SO.

[Kokusai]

The 50% would be sold to you at today's valuation + fees. I do not believe there is much room for negotiation.

If you are able to, I would staircase up to 100% (with mortgage) as you'll be in a much better position to sell later.

[GreyCloudsToday]

Same advice as Kokusai. Here valuations are done by an independent surveyor so the price may be lower than estate agent valuations. I'd staircase to 100% asap rather than do the complex 50/50 thing.

You could contact a mortgage broker with experience in SO for more advice.

[BullByTheHorns]

Thanks @Kokusai and @GreyCloudsToday

The 50% would be sold to you at today's valuation + fees. I do not believe there is much room for negotiation.

Hmm, I have never tried to down-value a property before!
Could I influence that in any way (making it look crappy or whatever), sweet talking the valuer into seeing my side of things as far as ethically possible etc

Looking at my existing lender, their calculator says they are willing to give me more than I'd need so I could do it by myself, let alone with partner involved too - and Doh! - i just realized the monthly rent charge would drop as well so that would free up extra cash.

Regarding advice, I think I/we need more than just mortgage advisor. We both agree some form of financial and cohabiting agreement would be of benefit as there are various assets to consider. Is that a solicitor's job? (I know there is big debate on MN about this type of thing but it is what we want)

[BackforGood]

I would start talking to the HA first, to check that the other 50% is available to buy, and not ringfenced to keep the housing stock available as a start for people not able to afford a 'whole' house. I presume that HAs choose to have stock like this just so people (like yourself all those years ago) get a chance at a start, and, if they sell it to tenants, then they can't help the next person/family to do the same.

[Newname20]

When surveyor came round to value ours so we could buy the rest of our shared ownership property, the surveyor was very helpful. He checked with us the purpose of the valuation and that we would benefit from a low valuation and so erred on the lower side when making his valuation.
A few months later we had a different surveyor round to value the house for our relocation package and we benefited from a much more generous valuation.

[Kokusai]

I would start talking to the HA first, to check that the other 50% is available to buy, and not ringfenced to keep the housing stock available

The whole point of SO was that people do staircase out as this returns capital and in theory enables them to build more SO. Unfortunately not as many people have been staircasing out as was expected.

[BullByTheHorns]

Just to come back on this, as of late Dec, I became the proud owner of a spanking new mortgage and therefore the nominal owner of 100% of my home!

I got a fab mortgage deal which I am delighted with (much better than my old deal which itself was pretty good), and my calcs show I should clear it within 10-15 years if I make overpayments at my current rate (incl what I was prev paying as rent and service charge etc).

Now just to remind the HA that I am no longer a leasehold owner given that they have sent me a letter telling me my new costs from April!

[FluffyWuffy100]

HUZZAH that is amazing news @BullByTheHorns well done :-)

[KanielOutis]

It's great news that you have bought 100%. Are you sure you have bought the freehold title though? That may well be a separate transaction, if it is for sale. If it is a house on an estate you may not be able to buy the freehold.

[PickleFish]

how do you avoid paying service charges now? I know that even if I could staircase up to 100%, I'd still have a fairly hefty service charge for communal things. (But mine is a flat, rather than a house, which I guess is different).

[Minniemountain]

Kaniel it sounds like OP owns the freehold now but the HCA are a bit behind on their paperwork.
Shared ownership leases always say whether or not the transfer of the freehold must happen on stair casing to 100%.
PickleFish you can't avoid paying a service charge if you own a flat.

[BullByTheHorns]

Yes @Minniemountain has it I think. When I called, they had no record of me on their rent/svc charge system, so my home has been taken off that, they are just behind on working out my pro rata refund and taking me off mailing lists I think. I've put a note in my calendar to chase it up in a fortnight if I haven't heard by then.

As regards the title itself, I have seen and signed the Land Registry forms transferring it to me (and it was in the lease staircasing section), so I am not worried on that score.

[BullByTheHorns]

Thank you @FluffyWuffy100! The lady I spoke to yesterday was also really nice and congratulated me on being able to buy a house and not have to move any boxes

[Alice2502]

Hello

I am in need of some advice. My partner and I are looking into buying a share of a 2 bed house through shared ownership. I have been accepted for a mortgage myself but unfortunately my partner is unable to gain a mortgage at the minute. I have heard good things and bad things about SO but one of the main reasons I am unsure whether to buy is that I know I won't make any money on the property as it is already being sold at a high price and I can't see the value going up anymore and also the problems that people have had with selling SO properties. We are currently renting a 1 bed flat but need 2 bedrooms as we are expecting our 1st baby in around 7 months. So do we carry on renting but move to a 2 bed property? We will still be able to save money for the next couple of years (whether we carry on renting or buy) and then try for a mortgage in a couple of years when my partner will be able to get one? Or do I purchase the SO property? I am so confused with what to do. We will be paying more monthly for a rented property but I think in the long run we will end up paying more for the SO property with deposit/if fees go up/the value goes down.

Thanks

[Alice2502]

Also - I am looking to live the SO property for 4 years max.