Co ownership

[Dogmama86]

Thinking about Co ownership as recently sold my property and will have a lump sum of about £130k to put towards another home. Is this possible to do if I see another property I like? What is the pros and cons? Would like any advice possible

What do you mean by co ownership?

The Shared ownership scheme or buying with a friend/relative?

@Twiglets1 the shared ownership scheme

The shared ownership scheme normally only applies to new build properties @Dogmama86 & the problem with those is that the properties tend to depreciate in value in the first few years as they aren’t so desirable once second hand. Also, you will be liable for 100% of the maintenance costs despite only owning a percentage of the property. Also, it costs money in fees every time you wish to buy a bigger percentage.

Personally, I would prefer to use the 130k as a deposit on an older property with a traditional mortgage (not Shared Ownership). However it’s personal choice and I can definitely understand the appeal of buying a “better” home than you would otherwise be able to afford at this stage.

As it's new build, anything structural is covered by the NHBC guarantee for 10 years. You also get a £500 annual allowance each year for 10 years for essential maintenance. This can rollover once, so if you haven't used it the year before, you get £1,000.00.

Our hot water cylinder has a 25 year guarantee, as long as you have it serviced annually.

When some tiles slipped in gale force wind, the HA came and fixed it on the second working day after reporting it. It wasn't for us to do.

We like having a S/O house, and we certainly couldn't have afforded a house this big / nice without the scheme (the location is amazing too).

The new S/O scheme also has 995 year leases, not 125, like the old scheme.

Make sure you get a brand new, not a sell-on, S/O if you go for it, to make sure you get the maintenance fund and long lease benefits.

I should say that our house wasn't meant be S/O, so it wasn't built to the affordable housing spec (assuming there is one). But the interest rates went up and the developer was stuck with houses which were ready and nobody wanted them. So the HA bought them to sell on via S/O. I don't know if the ones always intended for S/O would be lower spec.

We bought the show home, so have quite high spec flooring included as well, which saved us a fortune!

@Twiglets1 I wouldn't be able to have a traditional mortgage, not a decent amount anyway. I'm a single parent with a low income. Shared ownership seems to be my only option at present to be able to buy another home for myself and children.
I would be able to buy the house outright at some point?

My understanding of SO is that you can buy extra percentages yes so that you can eventually own the whole property if you choose to stay long enough. I think @NoWordForFluffy knows more about the scheme than me though.

I would definitely choose SO over renting in your position for the stability for you & your children- just wanted to point out some potential disadvantages of the scheme as I know you wanted to know the pros and cons.