For shared ownership you have to consider the fact that your rent increases, property value increases and interest rate increases. You also have to pay for the housing association legal costs (their solicitors). All things to consider when purchasing and staircasing to 100% You may not be able to afford to staircase as you’ll be priced out.
No, you don’t have to pay the freeholders solicitors costs when you staircase. You only do so if you take them to tribunal etc for challenging unfair charges etc
Shared ownership was the best option for me as someone who wanted to stay in London but didn't want to pay extortionate rent or mortgage! I feel like I've got property security (as no risk of landlord selling), low rent, low mortgage (and combined still cheaper than what I was paying for a ROOM in a shared flat previously) and an eco friendly, low maintenance home. It's a really good value option.
I’m not sure I’m going to bother after running the numbers (property value increase & int rates) it’s probably going to be cheaper for me to just pay the rent for the remaining amount. I’ve factored it into retirement costs anyway.
Brilliant conversation! Thanks all so much, for your time and sharing your knowledge. Glad you're alright after the accident Pete and hope your birthday was a good one nonetheless
I think another thing people don't think about is when the financial assessment is done you are essentially forced to buy the maximum share possible on the property which could be anything between 25% - 100% of the property (even with the new changes of a minimum 10% on Shared Ownership many developments don't offer this option). This compounds to another problem when you sell your new build (which becomes a old flat so loses its attractiveness) and a further issue of becoming unaffordable as the buyer will need to buy the share which you own as a minimum (if you own 50%+ they will need to purchase that amount) and have the deposit ready which is still very high and unlikely for a first time buyer to have such a large deposit ready for a higher share in the property.
A big downside to shared ownership is that you are completely responsible for all the maintenance of the property, even though you're paying rent on a certain amount!
Depends what you buy. I'm in a building of flats and I'm only responsible for the inside of my property (except the HIU) - the gardens / drainpipes / roof all are the landlords (and they pay the building insurance, I only cover contents).
@@conversationofmoney for example, the building I live in is barely 10 years old. For the last few years all landlords were on the hook for insane amounts of money. Government in UK is tyranny . So, first they made all owners to pay for fire guard (the guy who literally was in the building and doing checks 24/7 and all he could do is use a whistle and a call to fire department. That was like 20k a week or soemthing, because imagine that you need multiple certified people because it's 24./7. Then it was decided that we will install new heat sensors (the building has smoke detectors and fire alarms already connected to a central panel which displays exact flat where the fire is and it's all working (we had once a fire department show up due to sensor failure), but due to cladding it's considered not sufficient). And then after couple more years, now there's scaffolding around the house and cladding being replaced (I see at least 5 different employees each day through my windows around scaffolding and it was said the works will take a year. Just in salaries that's a lot of money! Add the permissions, the management, the materials, the scaffolding costs to that). In other words, there's always something to pay even if the building is new. I personally think it's government's tyranny - the building when built was matching requirements, and changing laws for previously built buildings is wrong. But that sets president that any new regulations in future will apply to old buildings, meaning all landlords emptying their pockets (you buy a place, in 1-3 years they say the building doesn't match requirements and you need to pay thousands upon thousand... more like hundred of thousand. I guess at this point it will be more than one million maybe two for the building I live in). And we know it's not a rare case. From other countries I can give more examples: like heat, electricity counters stop working after 2 years, and warranty is two years! Entrance doors get damaged and need replaced. Buildings have a fee which you pay to accumulate funds for bigger future repairs (I think this one apply to UK as well). So a new building is also costly.
@@PovilasPanavas I bought a new build and have had zero maintenance cost for the past 8 years. Some people maybe unlucky but ultimately some cost with homeownership should be expected and planned for. Service charges should be accounted for in your affordability it part and parcel of the deal. This is why buying a home is a costly business and may not be for everyone.
I passed the brokers affordability and now I am waiting for the housing association to allocate the house . if I pass the affordability does that mean there is a big chance that my mortgage will be accepted ?!
With the recent announcement on lease holding how will this affect shared ownership housing? Will developers now only be able to build flats under the shared ownership scheme.
I thought it’s a idea for lenders to calculate the energy/utilities cost together with mortgage payments to see what a person can really afford as a first time buyer. However, I wouldn’t benefit because I’m not a first time homebuyer .
Why shared ownership is only offered as leasehold . Why not freehold?. Govt get the gains, rent on there portion but no repair responsibility and people spend all their life paying for the rent and mortgage as a leaseholder and technically property goes back to the govt at the end of leasehold. Govt is the one keeping the freehold share of the property. If govt is trying to be fair they should do it 50/50 on everything and property should be offered freehold and lastly once you sign up it becomes difficult to get out of it or sell your portion of the property
This has been very helpful, given me so much clarity. Thank you
Glad it was helpful!
For shared ownership you have to consider the fact that your rent increases, property value increases and interest rate increases. You also have to pay for the housing association legal costs (their solicitors). All things to consider when purchasing and staircasing to 100% You may not be able to afford to staircase as you’ll be priced out.
No, you don’t have to pay the freeholders solicitors costs when you staircase. You only do so if you take them to tribunal etc for challenging unfair charges etc
Shared ownership was the best option for me as someone who wanted to stay in London but didn't want to pay extortionate rent or mortgage! I feel like I've got property security (as no risk of landlord selling), low rent, low mortgage (and combined still cheaper than what I was paying for a ROOM in a shared flat previously) and an eco friendly, low maintenance home. It's a really good value option.
Congratulation and thanks for sharing. Are you thinking about staircasing already?
I’m not sure I’m going to bother after running the numbers (property value increase & int rates) it’s probably going to be cheaper for me to just pay the rent for the remaining amount. I’ve factored it into retirement costs anyway.
Brilliant conversation! Thanks all so much, for your time and sharing your knowledge. Glad you're alright after the accident Pete and hope your birthday was a good one nonetheless
I think another thing people don't think about is when the financial assessment is done you are essentially forced to buy the maximum share possible on the property which could be anything between 25% - 100% of the property (even with the new changes of a minimum 10% on Shared Ownership many developments don't offer this option). This compounds to another problem when you sell your new build (which becomes a old flat so loses its attractiveness) and a further issue of becoming unaffordable as the buyer will need to buy the share which you own as a minimum (if you own 50%+ they will need to purchase that amount) and have the deposit ready which is still very high and unlikely for a first time buyer to have such a large deposit ready for a higher share in the property.
A big downside to shared ownership is that you are completely responsible for all the maintenance of the property, even though you're paying rent on a certain amount!
What's the maintenance cost on a new property broadly?
@peterkomolafe No idea... but that is how it has been with Sovereign housing. Be under no illusion.
Depends what you buy. I'm in a building of flats and I'm only responsible for the inside of my property (except the HIU) - the gardens / drainpipes / roof all are the landlords (and they pay the building insurance, I only cover contents).
@@conversationofmoney for example, the building I live in is barely 10 years old. For the last few years all landlords were on the hook for insane amounts of money. Government in UK is tyranny . So, first they made all owners to pay for fire guard (the guy who literally was in the building and doing checks 24/7 and all he could do is use a whistle and a call to fire department. That was like 20k a week or soemthing, because imagine that you need multiple certified people because it's 24./7. Then it was decided that we will install new heat sensors (the building has smoke detectors and fire alarms already connected to a central panel which displays exact flat where the fire is and it's all working (we had once a fire department show up due to sensor failure), but due to cladding it's considered not sufficient). And then after couple more years, now there's scaffolding around the house and cladding being replaced (I see at least 5 different employees each day through my windows around scaffolding and it was said the works will take a year. Just in salaries that's a lot of money! Add the permissions, the management, the materials, the scaffolding costs to that).
In other words, there's always something to pay even if the building is new. I personally think it's government's tyranny - the building when built was matching requirements, and changing laws for previously built buildings is wrong. But that sets president that any new regulations in future will apply to old buildings, meaning all landlords emptying their pockets (you buy a place, in 1-3 years they say the building doesn't match requirements and you need to pay thousands upon thousand... more like hundred of thousand. I guess at this point it will be more than one million maybe two for the building I live in).
And we know it's not a rare case.
From other countries I can give more examples: like heat, electricity counters stop working after 2 years, and warranty is two years! Entrance doors get damaged and need replaced. Buildings have a fee which you pay to accumulate funds for bigger future repairs (I think this one apply to UK as well).
So a new building is also costly.
@@PovilasPanavas I bought a new build and have had zero maintenance cost for the past 8 years. Some people maybe unlucky but ultimately some cost with homeownership should be expected and planned for. Service charges should be accounted for in your affordability it part and parcel of the deal. This is why buying a home is a costly business and may not be for everyone.
Where is the wallpaper from?
This was helpful, thank you!
Thanks this was very informative!
I passed the brokers affordability and now I am waiting for the housing association to allocate the house . if I pass the affordability does that mean there is a big chance that my mortgage will be accepted ?!
With the recent announcement on lease holding how will this affect shared ownership housing? Will developers now only be able to build flats under the shared ownership scheme.
Did you not see, Panorama The Home I Can't Afford
i don't watch TV but that still doesn't mean this doesn't work for in some cases for some people
@@conversationofmoney The episode is also on UA-cam, It's worth a viewing.
I thought it’s a idea for lenders to calculate the energy/utilities cost together with mortgage payments to see what a person can really afford as a first time buyer. However, I wouldn’t benefit because I’m not a first time homebuyer .
Why shared ownership is only offered as leasehold . Why not freehold?. Govt get the gains, rent on there portion but no repair responsibility and people spend all their life paying for the rent and mortgage as a leaseholder and technically property goes back to the govt at the end of leasehold. Govt is the one keeping the freehold share of the property. If govt is trying to be fair they should do it 50/50 on everything and property should be offered freehold and lastly once you sign up it becomes difficult to get out of it or sell your portion of the property
If you buy a shared ownership property after 2021 you can only staircase by 1% per year for 15 years.