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Find financial and money saving discussions including debt and pension chat on our Money forum.

Find financial and money saving discussions including debt and pension chat on our Money forum.

Money matters

shared ownership? is it a bad idea?

19 replies

FairyTaleinNewYork · 23/12/2005 11:50

desperatly want to get back on the property ladder once peter is post transplant and we are both working. but house prices here are way too much unless we land 20k+ per year jobs each, not sure if thats possible with no qualifications. but have seen a few shared owner ship properties and am wondering how they work. do you pay a monthly rent as well as the mortage? do you have to apply to the HA/council if you want to do any major work to the house? is it not worth it at all?

thanks.

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SackAche · 23/12/2005 11:53

Misdee - I know a few people that have done this and really swear by it! For some people it really is the only way onto the property ladder. You have to be put on a waiting list though.... so you should phone them pronto!

You get a 25%, 50% or 75% mortgage and the HA own the rest. You pay them proportional rent. It works out cheaper or much the same as if you had 100% mortgage. Then you have to option in the future to get a bigger stake in it.

Works well it seems.

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FairyTaleinNewYork · 23/12/2005 11:59

so how do i find out about the schemes?

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sanchpanch · 23/12/2005 12:03

estate agents also sell them, you need to let them know your intrested as they tend to sell quickly as its all many people can afford!!

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SackAche · 23/12/2005 12:04

In Scotland the company is called "Link". You could try that for starters?

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FairyTaleinNewYork · 23/12/2005 12:08

i have just phoned the council to find out more, and have been given a website.

tbh i dont want to be in a council house, i want some secruity of owner a home again. and tbh atm we are better off finicially. i would only be able to get a mortage in my name as peter went bankrupt a few years back. and 25% of property prices here (new build 3 bed) will still be around 40-50,000 i think. do-able really.

i like making plans, gives me something to do whilst stuck inside lol.

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FrostyTheGloworm · 23/12/2005 12:12

i can highly recommend it, although I cant give you any advice as I'm in Ireland. Our is through the county council and were were on a wairing list for quite a while. Also there was a huge amount of hassle/paperwork/red tape, way more than with a normal house purchase.
It was worth it though as we would never have got a decent house, or any house for that matter, without shared ownership.

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FairyTaleinNewYork · 23/12/2005 12:13

do tyou apply for a mortgae through the HA/Council, or do you have to sort it out yourself?

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vitomum · 23/12/2005 12:19

don't know load about this but have friends who are shared ownership and they swear by it to. It is a great way to get a foothold on the property ladder. In terms of mortgages i think only certain lenders will be available to you. I think friend said they could only get 95% too. But as they were only looking at a #30k mortgage `the 5% deposit was failrly manageable. HA should be able to point you in right direction.

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FairyTaleinNewYork · 23/12/2005 12:27

will put ourselves on the list then ojnce peter is post-transplant and we are both working, thats if we havent been able to get a bigger place before then. i am going mad in this teeny bungalow.

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FrostyTheGloworm · 23/12/2005 12:30

i think your best option is to ask the HA/council.

in Ireland, you get the mortgage from the council. each month you pay them some mortgage(for the half you own) and some rent(for the half they own). we got 100% mortgage and deposit was only about £900. Apart from giving proof of income avery year we dont really have any other involement with the council now, we can pretty much do what we want to the house in terms of home improvements etc.

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FairyTaleinNewYork · 23/12/2005 12:36

thanks.

i have just been looking at house pries here on haart, and the cheapest 3 bed is a 172000, waay out of our reach lol.

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mumfor1sttime · 23/12/2005 12:46

I was thinking of the shared ownership myself. I am in a 2 bed HA new build already and the only way that I can afford to move or get on the ladder is to buy a portion of this house or move into a council house and buy it 100% as I have been a council tenant before. I have a friend who has bought half their HA house, and they got 100% mortgage, and pay the HA rent for their half of house, beware that you do have to pay for repairs and maintenance yourself even if you only own some of the house.

Not sure on all info on moving into a house that is 'shared ownership' straight away - but try this website - www.homes.org.uk - sorry cant do links. They have info on there about 'shared ownership' schemes across the UK. Also has info on Council exchanges etc.

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mumfor1sttime · 23/12/2005 12:50

As for the Mortgage question - go to your bank. Please DO NOT go to these 'cowboys' on TV ads.
They charge you a hefty amount of money to sort things out for you - you dont need to spend more money on this as well as surveys etc.

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We3kingsofOrinocoare · 23/12/2005 21:14

Abbey, Halifax, Ipswich Building Society, Nationwide, West Bromwich Building Society and Woolwich all do shared ownership mortgages, so as mumfor1sttime says, don't go to the cowboys that advertise on the telly!

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FairyTaleinNewYork · 23/12/2005 21:26

i wont. we have now have a sort of plan. once dh is a year post transplant, and i am working we will go on the list for a 3/4bed council house and the shared ownership list, whatever comes up 1st, we will consider seriously.

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jennifersofia · 23/12/2005 21:34

Hiya, our house is shared ownership and it has been fantastic. It has enabled us to buy a 2 bed terrace with a little garden fairly centrally located in London and allow me to be a SAHM. We own 40% and pay a (minor) rent to the HA for the other 60%. It is also possible to 'staircase', that is, increase your percentage. If you get up to 100% you can sell it on the open market. Otherwise, you sell it through the HA. You then get your 40% (or whatever) back of the selling price, plus any improvements you have made and documented. We are responsible for all upkeep and repairs and really the HA has very little to do with us other than making sure that our rent is ticking over.
The disadvantage of selling through the HA is that they value it lower than market value because they are trying to help others onto the scheme - however, this benefits you when you are buying. Our one (and maybe others) is aimed at first time buyers and key workers. We did have to go on a waiting list but it didn't take that long until we found something. The other important prerequisite that our HA had was to be on the waiting list for a council house - but that is just form filling.
Another possible disadvantage is that technically you are not allowed to rent the house out, although we have been told that people do.
There are loads of HA out there and it is worth shopping around as some charge much lower rent than others. Also important is to check out any service charges that they might include.
You are more limited in the banks you can get the mortgage at, but as We3kingsofOrinocoare points out, there are still quite a few to choose from.
Sorry not to give you any links - info is buried and I haven't wrapped a thing yet!
HTH

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FairyTaleinNewYork · 23/12/2005 21:38

thank you. council told me that all the new build areas a certain % wil lbe released for shared ownership, and as there is a huge devolpement being built over the next 8years not too far away, i am sure womething will come up. i'll need to be earning around 10k per annum, based one being able to borrow 5x what i earn, for house prices here to get soemthing decent i think. gives me a goal to work towards after the trasnplant.

cant belive the house prices have shot up so much since we sold our flat in 2001, (we bought it in 99 for 54k, sold in 2001 for 85k, they are now going for around 120k )

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BonyBethleheM · 23/12/2005 21:40

Misdee - when I split from my 1st dh I bought a shared ownership property as it was all I could afford. It was fantastic - I loved that house and still have very fond memories of it.

It enabled me to get back on the ladder and I would highly recommend it. I got my mortgage from the Abbey.

I was told at the time that shared ownership properties are actually built to a higher standard than ordinary properties (although don't know if that's just in my area).

I got mine through the local housing authority - they keep a list of people who are interested and when one comes up for sale they contact everyone on the list. When I came to sell it I just got back in touch with the HA and had about 8 people straight away who were interested in buying - the first one who came around bought it!

I would say definitely go for it if you have the opportunity.

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FairyTaleinNewYork · 23/12/2005 21:42

thank you. tbh i was interested in shared ownership when we 1st owned a property but dhy and his family said not to as they were a new idea ithink. now dh also thinks it could be a good idea as it will enable us to actually get somewhere we like and not have to wait for the council to offer us a larger place.

hopefully in 2007, if i am still a mumsnutter, they'll be a post about where to get a mortage lol.

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