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Shared ownership

9 replies

whatyousayin · 17/09/2022 13:51

I'd love to hear from people who have had experience with Shared Ownership, how do you find this scheme?

OP posts:
RedToothBrush · 17/09/2022 14:11

There is no one scheme. That's the first thing to wrap your head around.

Schemes vary widely. My advice is always to read the small print on them. If you do decide to go ahead, get a solicitor with experience in shared ownership.

The biggest things to remember are, they only really work in a market where prices are increasing. If they are declining then the issues with negative equity get compounded as it can be harder to sell (you don't have the same freedom to drop the price), you can't sublet out the property and it can be harder to get remortgages/staircase.

That said, it DID work for us. But I'd argue that was because our household income increased significantly.

Our neighbour had a lot more problems.

Stuff to look out for. Do you pay rent on the other part of the property. If yes, how does it increase? (is it linked to inflation). And are there other hidden service charges. (some horror stories with this).

This is why it is so important to check the details.

I would say that they are best for people who want to live in an area for a long time (preferably those with local family links and less likely to move for this reason) and those people for who renting would be the only alternative, because it offers long term security.

You also have to think in terms of your long term future. If you are a couple going for a 2 bed house and you want 3 kids, you are going to have to sell on at some point. You really want to get a house which is going to suit you longer term in case you do get stuck.

I am not either for or against them. More a 'really understand what you are getting into' type of person.

AntiHop · 17/09/2022 14:52

@RedToothBrush has done a great job of explaining. We also used to live in shared ownership. It worked really well for us.

It's great as a way of getting out of rented and giving you stability. If you can afford to buy without it, don't choose shared ownership.

whatyousayin · 17/09/2022 15:51

Thank you so much for taking time out to reply. I can't seem to find much consumer feedback online which is slightly concerning! I will be looking in to it all very greatly before making the decision!

OP posts:
RedToothBrush · 17/09/2022 15:53

whatyousayin · 17/09/2022 15:51

Thank you so much for taking time out to reply. I can't seem to find much consumer feedback online which is slightly concerning! I will be looking in to it all very greatly before making the decision!

Part of the problem is precisely because so many schemes are so different.

You really need to look at the details. Some shared ownership schemes, I wouldn't touch with a barge pole. Others are a lot more favorable.

You need your financial head screwed on for one. Don't take sales pitch at face value. Do your own research and get your own advice.

LittleLlama · 17/09/2022 16:08

My friend lives in a shared ownership property and she is positive about the experience. The shared ownership property was brand new and so she had a ten year warranty. This was important to her as she wanted a property with little maintenance.

Before she moved into her shared ownership house she had rented for a number of years and had to move quite a few times because of the Landlord’s changing circumstances. She now has security which was very important to her.

She intends to stay in the same house for the next twenty years - hopefully. This means she doesn’t see it as an investment or a step on the ladder - but her home.

sorrynotathome · 17/09/2022 16:14

Remember that ownership is the only bit that’s shared. You’re responsible for 100% of maintenance, bills, insurance, utilities, repairs, council tax etc etc. I think if you find a scheme that costs you less than renting the equivalent property, it can be a good choice. Selling it on could take longer than a standard property.

sharedvictim · 20/01/2023 20:47

Shared ownership is a scam. Most people in shared ownership dont actually understand how it works. You do not purchase a share of the property, that is simply not true. You are paying a premium that gives you the right to purchase at some future point. If you loose your job and can not pay rent for just two months the HA can evict you , you loose the property and any equity you put into into it and still have to pay off the mortgage even though you no longer live there. Plenty of people get into trouble with this scam , take serious legal advice before getting involved

messybutfun · 21/01/2023 06:18

sharedvictim · 20/01/2023 20:47

Shared ownership is a scam. Most people in shared ownership dont actually understand how it works. You do not purchase a share of the property, that is simply not true. You are paying a premium that gives you the right to purchase at some future point. If you loose your job and can not pay rent for just two months the HA can evict you , you loose the property and any equity you put into into it and still have to pay off the mortgage even though you no longer live there. Plenty of people get into trouble with this scam , take serious legal advice before getting involved

Banks will also evict you if you can’t pay your mortgage that’s not the scam.

The scam is them telling people they can start owning with a share starting at 10% or even 25% and mortgage that share with maximum affordability to retirement.

You may start paying a bit less at the start compared to renting but with inflation no longer under control this will go pear shaped very soon.

SquashPenguin · 21/01/2023 06:32

Wouldn’t touch it with a barge pole.

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