Shared ownership flat as a single person on £30,000 - is it achievable?

[themsc]

I'm on £30,000, and living with parents. I've been looking into renting or potentially shared ownership flats.

Rent for a 1-bedroom flat is around £1000/month minimum. Shared ownership flats are around £400/month mortgage for 25% ownership with £450/month rent on top.

Do you think it's achievable for a single person or do I have my head in the clouds?

I live in the South-East

So you take home around £2k. You could do it but I'd be careful about not adding children to the mix for a good while.

Is your job transferable or WFH? Could you move to a cheaper area?

I would say that you’re unlikely to qualify for shared ownership on just your salary alone. I earn 40k and when I spoke to various shared ownership schemes, they all said I failed the finance test.

Mortgage + rent + service charges.. it all adds up and becomes expensive very quickly.

Shared ownership properties are hard, if not impossible, to sell and many people end up stuck in them unable to move.

They are also massively overpriced, from what I can see.

If you’ve never lived alone before, or away from your parents, try a house share first. On your salary a monthly rent of approx £700 should be affordable. Even better if bills are included, although I’m not sure if that’s a possibility nowadays.

If you want to buy, your best bet is to buy a property with a trusted friend and then live together. That way you have twice the income when making your mortgage application, and the banks are more likely to approve the mortgage.

It's what I did and I was on 25k. I made good profit on that flat, lived there for six years then sold without staircasing and bought a house that wasn't shared ownership. Just make sure it's in an area where re-sale will be easy, mine was a twenty minute walk to a mainline station that was 23 minutes to a main London terminal, I had an open morning and everyone who attended applied for it. I wouldn't have got on the property ladder on my own without it. Mine was one bed,I could've had a two in a sightly worse location but didn't want to stretch myself.

Don't forget service charges and Insurance. Plus you are responsible for all maintenance, yearly boiler checks etc. Your rent and service charge will increase every year. We got our shared ownership just before the mortgage rates went up we now pay 50% more overall with the rent and service charge increase and its only been 3 years. I wish we had done more research before we got ours from what I've seen since 50% regret going shared ownership 50% say it worked for them.

It's absolutely do-able - dependant on your outgoings too. Best thing is to talk to a broker who will give you an idea on how feasible it is.

Theres some good advice about SO I found on various facebook groups too.

They are not always hard to sell, people always say that - they are actually really sought after in some areas. Service charges can be high, and subject to increase often. They can be a great first step on the ladder. I used to do mortgages on them. You can increase your chance of being considered by having a decent deposit, and no other monthly credit commitments like loans / car etc.

Following.

I was considering SO for my first place. I'm on 30k too and got some decent inheritance coming my way but I still don't think I would be able to afford a conventional mortgage for the house prices in our area (south west). Concerning to read Frankie's post above about how it's difficult to sell SO property. I'll follow this thread for anymore advice. The property market really is dire at the moment isn't it.

Just coming on here to say that selling a SO flat is not necessarily "difficult" -especially if its in a good location. Resales are always cheaper, and re-sales or recently new flats are especially a good deal. In my experience, it was hard to get a SO place because, even after being financially approved, I struggled as there were so many people applying and someone else always getting in first!

The only thing I would say - don't "staircase" unless you are planning to stay in the flat and work towards 100% ownership. 50-75% ownership is harder to sell.

I would avoid flats and look at shared ownership houses, by the time you add in the extortionate services charges that can be raised whenever they like flats are often much less affordable than houses where at least you know your costs are all fixed.