Please or to access all these features

Add post

Watch this thread

Save thread

Start a new thread

Flip thread

Hide thread

My feed

Active Unanswered threads

Getting started FAQ's

Unanswered threads Acronyms Talk guidelines

Hide shortcut buttons

Talk

AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Flip

1 2 3

Original poster

To be scared of shared ownership?

63 replies

Neverender · 01/09/2019 18:51

Seems like an incredible opportunity to get on the ladder. Many people have warned me but they're not specific about their worries, more, "Well, you don't completely own it."

If you have a mortgage then you don't completely own it anyway?! 🤷‍♀️

Can any of you lovely people advise as to why it might be/is a scam and not a good idea?

Thank you!

OP posts:

KitKat1985 · 02/09/2019 07:36

We bought a second hand shared ownership house 8 years ago (when house prices were low) and made enough equity in it that when we sold it last year (7 years later) we had enough equity to use as a deposit for a 3 bed house of our own. We never would have got here without it. BUT a few warnings based on what I've learnt:

Don't buy a brand new shared ownership house. Like all new build they are often sold at a premium price so making equity back on a new build is going to be difficult.
Our housing association were flippin' useless. Took them weeks to do anything. Selling the house took months, and a good chunk of that was because of how slow and ineffective they were.
Remember you will be 100% responsible for all maintenance costs even if you only own a small share, so make sure you budget for that.

Someone summed up shared ownership to me by saying that when it comes to maintaining the house and all the costs involved upkeep, the housing association will insist it's your house and your responsibility. When it comes to wanting to sell the house however, the housing association will insist it's their house and make you jump through all of their hoops.

JHaniver · 02/09/2019 07:43

We lived in a shared ownership flat for ten years. The rent was reasonable and we only ever had slight increases in the rent and service charges. When we sold we had plenty of interest. It was fine.

CParker12 · 02/09/2019 07:47

It depends on your circumstances. We’ve been in our shared ownership property since April 2019. It was the best way for us to get on the property ladder and we own 40%. I do think the service charge is a bit steep and I intend to contest this. Despite this the housing association are great and sort out all our repairs, great communication and we have a lead person we can speak to if we have any problems. We also plan to staircase to increase the shares, this was a great option for us as we can take our time to do this and we didn’t need a huge deposit to start with.

JustLikeJasper · 02/09/2019 07:50

I had a SO flat, sold it after 3 years and made a fair bit of money, yes the selling process was quite long and drawn out (being 8 months pregnant didnt help my patience!).
Service charge did go up but not by outrageous amounts and rent only went up once.
It was the only way i could get on the property ladder and got a lovely home.

Girliefriendlikescake · 02/09/2019 09:27

I live in a shared ownership new build and absolutely love it! It's on a lovely new estate and means my dd goes to an outstanding secondary school. For a new build the house is spacious and it's been built to a high standard, it's also an eco house so we've got solar panels and it's well insulated etc.

There is no way I could have afforded a house in this area any other way.

So far my rent and service charges have not increased in three years and rent plus mortgage is still about £300 less than it would cost to privately rent a similar property .

Pjmom72 · 02/09/2019 12:26

Be very afraid. You own a % but are 100% responsible for the property upkeep, bills, service charges, rent etc. You are at the mercy of the company who owns the other % as to when you can sell, how much for, their rent and rates charges etc. They rely on people being so desperate to be on the ladder but cannot get a mortgage enough to buy. If a bank won't lend you the money, then these guys will - for your soul. Please avoid at all costs. Good luck to you. X

sweetmusic · 02/09/2019 12:34

We had a very good experience with shared ownership.
Meant we could move into a lovely house that suited our needs, was 200/300 pounds per month cheaper all in than some of the identical properties being privately rented on our street. V affordable. We had no issues selling- the s/o properties around my area tend to sell very fast.

There’s also the option of buying fully so if you see a property that would be ideal in the long term then that’s another plus.

scittlescatter · 02/09/2019 12:37

It's obviously not a scam, it's a government backed scheme.

I also had a shared ownership property. It was great. Mortgage plus rent and service charge was less than half the cost of rent on a similar local property.

When I sold there were more buyers than I could shake a stick at (did one open day and had multiple buyers interested). Made lots of money of it too.

Service charge went down.

Only downside was the bureaucracy of dealing with a housing association.

Jammymare · 02/09/2019 12:41

I own a 75% share of my terraced house. For me, best decision I ever made. It’s with a good HA, no service charges as a house, and rent on the other 25% is reviewed annually in line with inflation.
It was the only way I could get onto the housing ladder as a single person, and I will be looking sell next year (brexit dependant) to buy a freehold.
My advise would be don’t by a new build, make sure it’s a long leasehold and talk with neighbours in the same scheme to check they are happy before you purchase

Aderyn19 · 02/09/2019 12:58

My first house was shared ownership. HA paid 30% which acted as the deposit. We paid 70%. HA didn't charge us any rent or service charges. When we sold they got 30% of market value. Luckily property prices had risen or we may have ended up being them their initial investment if market had crashed and we'd still sold.
It worked for me - I made 50k and bought my next house. It worked for the HA who also made a profit to reinvest.
The devil is in the detail. I don't see it as particularly advantageous if you have to pay rent on their share and they get back more at sale time than their original investment.
Also there were restrictions on building extensions, which is why we sold.v
Look at the contract really carefully because not all shared ownership are as good.

Soffie89 · 02/09/2019 14:02

petition.parliament.uk/petitions/261118

Dropping this here for people to read, sign, share please :)

Problem with S/O is it is Leasehold so basically you own a piece of paper opposed to a actual house. Government needs to do some serious and fast legislation on this scheme!!

Leasehold in Law is a Tenency. As someone wrote its very true, its your house when it comes to keeping it and paying for it. But theres when it comes to profits and selling. We learnt not to spend a lot on our house as basically we are giving a high % profits to the h/a at cost of us.

With s/o your seen as too poor for rights of a ordinary home ownership

Vyxvy · 02/09/2019 16:04

I am very sceptical about shared ownership. Most that I have seen are overpriced. They are leasehold & the service charges are high. You have to really think about whether this is the best choice for you. Can you afford to buy, the rented part percentage, of your property back? How straight forward is to sell your property? Maybe an option would be to buy a property outside of London & commute, as you can get a little bit more for your money. I wish you luck.

sunshinesupermum · 02/09/2019 16:12

Which housing associations should be avoided or do any of you recommend, particularly in London/South East? TIA

NoBaggyPants · 02/09/2019 16:25

My experience was very positive. The rent and service charge increases were capped at RPI, so no nasty bills. To sell I had to pay for an independent valuation (fair enough) and then it was marketed through a normal estate agent. SO is rare in my area so the property sold within a day.

I have looked at other schemes since, that haven't been nearly as good value. It's very much a case of looking at the detail, and it's worthwhile paying for a good solicitor that will explain the detail to you.

NoBaggyPants · 02/09/2019 16:26

If a bank won't lend you the money, then these guys will - for your soul

This makes no sense, housing associations do not lend you the money. I think you're confusing SO with something else, though I'm not sure what.

Hatherden123 · 02/09/2019 16:31

There is a good BBC documentary on the problem of SO trapping people in a falling market - well worth watching with an eye to the current market down turn due to Brexit.
In brief the value of new build SO are stated, people then become trapped when they try to sell.

Pinkflipflop85 · 02/09/2019 16:36

Avoid any SO that has any dealings with first port.
We are with Hyde and the customer service is beyond appalling.

FFSOMG · 02/09/2019 16:40

Not rtft but we had a positive experience with shared ownership. We got a three bed semi/end terrace with 50% shared ownership. Sold it a couple of years later for the same amount as we had bought it for roughly I think, and was able to afford a 100% mortgage on a 4 bed detached, which we would never have been able to do had we not got the shared ownership first.

Mouikey · 02/09/2019 17:08

We started with a new build SO property in the south east about 16 years ago.

Pros - got us on the property ladder and now have a privately owned property not too far from the original house. We had a 50/50 and wouldn’t staircase unless it was to 100%.

Cons - HO useless. Any issues and they had no interest and issue with service charge (wasn’t in the contract) became an issue but resolved eventually. Snagging initially was a problem butwould have been the same with any new build.

Selling was horrendous. Eventually had to threaten to write and complain to their chief exec to get things moving as they delayed everything.

Remember you maybe able to afford 70% but it will limit your market if you come to sell. We stuck at 50% would have gone 100% but I had an ethical objection to taking the housing out of the affordable housing market.

Our HA was expensive rent wise others locally were significantly cheaper (think, and this is 16 years ago, £500 rent on our 2 bed terrace compared with £99 for a 3 bed semi!).

Overall it did work for us, but we had to time it right for when we moved and we’re also lucky that a first time cash buyer who waited for us to find a house.

Best thing I can advise is to find a decent solicitor who has dealt with SO before.

DishingOutDone · 02/09/2019 17:18

@Hatherden123 - is that still on iPlayer do you know?

DishingOutDone · 02/09/2019 17:19

@sunshinesupermum - Which housing associations should be avoided or do any of you recommend, particularly in London/South East? TIA

Me too - anyone?

Pinkflipflop85 · 02/09/2019 17:24

I mentioned one to avoid earlier on

Girliefriendlikescake · 02/09/2019 20:01

I'm with Stonewater and they've been okay.

HelenaDove · 02/09/2019 20:08

"Someone summed up shared ownership to me by saying that when it comes to maintaining the house and all the costs involved upkeep, the housing association will insist it's your house and your responsibility. When it comes to wanting to sell the house however, the housing association will insist it's their house and make you jump through all of their hoops"

THIS with bells on.

HelenaDove · 02/09/2019 20:09

Avoid Sanctuary and Clarion. The rent accounts and computer systems are in a hell of a mess. The former are using SAP.

Flip

1 2 3