Just always keep in mind, you will buy a SHARE of a lease. You will never own that property even if by some fluke you manage to staircase up to ‘owning’ a lease 100% The Advertising Standards Agency have forced certain adverts to be withdrawn because they mislead people into thinking they are actually part buying a property, they are not! They part buy a lease, this means the buyer is always a tenant but with out a renters legal protection. Thanks for this very informative video! I really hope it reaches many people, I will share and share it!
I’m hosting a Decision Making Clinic: How to Make Money Making Decisions in Property Investment on Monday 26th October 2020 at 6:15pm UK Time. I’d love for you to come! Here’s the link to register ➡️☺️ ncrealestate.co.uk/free-sessions/
Thanks for the video, it has been helpful! My issue is my wage - I've saved and I've saved and now have a decent deposit, but there is no point when the mortgage they offer me with deposit cannot buy anything . . . .unless I move up north and I'm in London 😣
I’m on the same situation, got a deposit, searching and searching for properties but London is just unaffordable. I went today to a First time Buyer event and everything was targeted to mainly Share ownership (that I’ve never been much interested at) So I decided to again do a bit of research. It looks like it is the only way to get into the property ladder in London is you don’t want to move far far away from London. But I don’t want to use than scheme. So I don’t know what to do. It is supposed to help the first time buyer but not according to this video 😑
@@KemiS-M im actually in the same position same deposit same wage ! you cant afford anything with that wage really, all you can do is buy somewhere cheap rough it out probably a place you dont want to be, you could try give it a lick of paint. or go share owership.. arrgh its tough.
I think whether Shared Ownership scheme is worth it comes down to two things. ONE - read the reservation notes (service charge rate, rent percentage, rent increases if any, limitations on staircasing etc) - TWO - how much do you currently spend putting a roof over your head? Reality is for most FTBs, they are lining landlord's pockets and will have nothing to show for it after several years. I have spent £40,000 on rent in less than 4 years and even in a Shared Ownership scheme, I would still have built at least 25% of that in equity had I purchased the minimum percentage allowable. Renting is ALWAYS going to be worse than buying, even if you're only buying a SHARE of a home. I encourage everyone to read the lease document, reservation documents and get on the ladder ASAP. Just be smart about it - and you have yourself a cute little stepping stone investment!
Also a lot of what this lady is saying assumes your pay will not increase in line with your staircasing plan. Who is still earning £30k when they're 40, realistically, that's graduate salary. It's the same for anyone who decides to remortgage on their 100% mortgage home - you need to really "move up" in your career if you want to move up in your property :)
They make it look like shared ownership is a cheaper option when buying a house for first time buyers and they make it seem very attractive but it works out to be a lot more expensive.
It is all cons according to me. Real estate is a market of cartels which favours everyone other than the buyer. If one happens to be a first time buyer, one is a looser. Your video was really helpful for me to understand shared ownership. Thank you.
I’m hosting a Decision Making Clinic: How to Make Money Making Decisions in Property Investment on Monday 26th October 2020 at 6:15pm UK Time. I’d love for you to come! Here’s the link to register ➡️☺️ ncrealestate.co.uk/free-sessions/
What you are forgetting is that we are about to Brexit, and the chances of property prices dropping are very high. This would then mean the shares and rent would become much more affordable. Swings and roundabouts.
And what you are forgetting is that, as a minority investor in a shared ownership your options will be mostly at the mercy of the majority shareholders (e.g. they will still dictate the rent payable and have you by the balls should you wish to negotiate it downwards. You'll also still get screwed on service charges, to name but two major weak hands) - regardless of whether house prices rise or drop.
I’m hosting a Decision Making Clinic: How to Make Money Making Decisions in Property Investment on Monday 26th October 2020 at 6:15pm UK Time. I’d love for you to come! Here’s the link to register ➡️☺️ ncrealestate.co.uk/free-sessions/
Hi, Thank you for that, I was actually looking into shared ownership to start me and my wife off to get our own space, but listening to that has put me on doubtful edge. I will re-discuss this and will most likely conclude on doing your advise
Very informative video thank you! So frustrating at the moment, I’m just out of London in Hertfordshire and the prices are absolutely ridiculous. Even though I earn reasonable money, as a single guy Ive got zero chance of getting a full mortgage myself for anywhere that isn’t a flea pit! Looks like I’m doomed to rent forever unless brexit brings down the house prices!!! 😂
The main benefit of shared ownership is that it enables individuals with low borrowing power to move into properties which they could otherwise not afford to occupy - so I don't understand why you are so frustrated. OF COURSE buying 100% is better but if the house you need is £400,000 (to use your example) which would buy a decent-size house in all but the most expensive areas of the UK, and you only earn £30,000 per annum, then a more valid comparison would be "Shared Ownership v Renting" ......................... In the UK, house prices tend to double every eight to ten years, so your share in the equity also increases in value. (And yes, I know that there are occasional blips in the market.) If you rent, you don't get the benefit of any increase in the value of the property which you occupy. So chill-out Natasha; stress is the silent killer !!!!!!!!!!!!!
Shared ownership should really be used to get on property ladder. Let the market growth give you the equity. Sell up and buy somewhere else outright with your equity.
well i was going to ask if it was good for that because that is my plan to buy an intial share then as soon as theres equity sell up and buy a property with 100 % mortgage on another property
Yes! That's an idea, but it's difficult to get out of your share... video to follow over the next few weeks. See my comment above Channette, let me know what you think :)
NC RealEstate why is it difficult to get of the share? Isn't just the same as normal selling. Just done though the housing association as a preowned property? Just wondering
If the housing association can't sell it after the time scale set out in your lease then they hand it back to you to sell 100% of it. You are then responsible for 100% of the agency fees (even though you are technically selling your own %) plus the more expensive legal fees associated with buying out the 100% share and then completing with the new purchaser on the whole property.
I cannot save for 100 % deposit so my plan was to buy an intial share then as soon as theres equity sell up and buy a property with a 100 % mortgage on another property what do you think of this
How about looking into the Equity Loans via help to buy? You save a 5% deposit, the Government helps you with a 20% loan on the property and then you get a mortgage for the final 75%. The benefit is a 75% mortgage is far far cheaper interest wise than a 90% mortgage or a shared ownership mortgage. I.e you can currently get rates around 1.5% whereas shared ownership mortgages are in the 3-4%'s. The only thing is you have to pay off the Governments share within 5 years otherwise you have to pay interest. So buy in an area where property prices are going up and then within 5 years remortgage and use the increase in value to repay the Government :)... would it be helpful to do a video on this?
Forgot to mention that there is lots more information and help with shared ownership on the Facebook page and the utube page ‘The National Leasehold Campaign’
But not 75% rent as well which they could put up?and Don't forget staircase will not be valued at original flat valuation but on the current valuation which more than likely gone up
can you give your opinion on areas in greater London to purchase an apartment or house that has a good chance of increasing in price. Anywhere in the region of 250-350k
Thanks for the information. If I am paying rent anyway and I only have a small deposit with low borrowing potential due to earnings, would it not be in my favour to pay the same amount I would in rent but have a stake in the property? If property prices increase I can sell of my percentage later down the line if circumstances change and use that to be in a better position than I would have been if I was paying rent only and struggling to save?
Yes that could be the case but it seems these new builds are having an extra first time buying premium built into the purchase price. Only the most affluent sought after areas have found a price increase and other areas valued far less then when bought new. The developer can raise the initial price because they get the sale of the property percentage and sale of the ground rent to investors and because you will only buy 25% it is affordable to you... so the inflated price is not noticed. But in the right circumstances, like all leasehold, you might get a short term price increase, then sell on and make a modest profit. But if you look at it as and investment opportunity then do your homework. SO is cited as ownership but its a leasehold, so you staircase to 100% and then you own 100% of a lease! Read a lease ... it says "tenant" not freeholder!
I’m hosting a Decision Making Clinic: How to Make Money Making Decisions in Property Investment on Monday 26th October 2020 at 6:15pm UK Time. I’d love for you to come! Here’s the link to register ➡️☺️ ncrealestate.co.uk/free-sessions/
Hi Natasha, Good video thanks! This may sound like a stupid question but I've not been able to find an exact answer! We have a shared ownership house and at the time of buying it, it seemed the only option for us. Our house was valued at £200,000 and we brought 50% - We think the house is currently worth around £250,000ish and are looking to move away from shared ownership and away from this house. My question is how does the profit work? If the house sell's for £250,000 and we owned 50% do we walk away with £25,000 in our pocket? (as that would be 50% of the profit?) And secondly - We both earn more than we did when we brought the house and could get a mortgage for the full value if we wanted to - But as I said we want to move - Would it make sense to buy out the other 50% and then sell, Or just sell the 50% and start over again? If you hadn't guessed we've never sold a house before so we've no idea what we are doing :D Thanks :)
Yes you walk away with 25k in your pocket, you own 50% of the property soyou get 50% of the net proceeds of the sale. No point buying the other 50% as it will cost you £125,000, so you don't make any money when you sell 100%. All you do by buying the extra 50% is just create an extra step in getting rid of the property which may have costs to that extra step. Sell up, 25k a good return. Get a normal mortgage and stay away from this scam unless you want to invest cos you know the housing market is going up
Hi Should I buy a house with share ownership or not? I really confuse about share ownership. It’s my first home so I can’t afford to get the 100% home. Could you please tell me it’s good or bad idea to get share ownership? Thank you
Hi, I’m planning to get into share ownership with my brother, but I’ll goal isn’t to own 100%, as we only want own the property for 3 years then sell our shares. Is this ok
Feyi Bolarinwa just be wary of the market, the shared ownership provider will always want to make sure that the property is sold on for more so that they can continue to make money. So make sure you ate buying in a stable market (not one that will go down) and that there is demand in that area for shared ownership so that there is a market to sell it on in a few years time.
Hi thanks for the vid it just confirms my complete aversion to shared ownership. One thing, if by some quirk a person managed to aquire the full 100% ownership.. would the property still be leasehold?
How fucking crazy is it that we need government help to buy our own homes? Guys like me who do 60+ hours a week and can't even afford a real home for my family.... Which I waited until I was in my 30s to have because I wanted to own a home first 😂
Just always keep in mind, you will buy a SHARE of a lease. You will never own that property even if by some fluke you manage to staircase up to ‘owning’ a lease 100% The Advertising Standards Agency have forced certain adverts to be withdrawn because they mislead people into thinking they are actually part buying a property, they are not! They part buy a lease, this means the buyer is always a tenant but with out a renters legal protection. Thanks for this very informative video! I really hope it reaches many people, I will share and share it!
I’m hosting a Decision Making Clinic: How to Make Money Making Decisions in Property Investment on Monday 26th October 2020 at 6:15pm UK Time.
I’d love for you to come!
Here’s the link to register ➡️☺️ ncrealestate.co.uk/free-sessions/
Thanks for the video, it has been helpful!
My issue is my wage - I've saved and I've saved and now have a decent deposit, but there is no point when the mortgage they offer me with deposit cannot buy anything . . . .unless I move up north and I'm in London 😣
So right!! I have 25k but earn 34k. Even with minimal debt, the offered mortgage amount is below 200k. In London that's chicken change!
I’m on the same situation, got a deposit, searching and searching for properties but London is just unaffordable. I went today to a First time Buyer event and everything was targeted to mainly Share ownership (that I’ve never been much interested at) So I decided to again do a bit of research. It looks like it is the only way to get into the property ladder in London is you don’t want to move far far away from London. But I don’t want to use than scheme. So I don’t know what to do. It is supposed to help the first time buyer but not according to this video 😑
@@KemiS-M You can look in areas like Belvedere and Erith where you could find a 1 bed flat for £180,000
@@KemiS-M im actually in the same position same deposit same wage ! you cant afford anything with that wage really, all you can do is buy somewhere cheap rough it out probably a place you dont want to be, you could try give it a lick of paint. or go share owership.. arrgh its tough.
I think whether Shared Ownership scheme is worth it comes down to two things. ONE - read the reservation notes (service charge rate, rent percentage, rent increases if any, limitations on staircasing etc) - TWO - how much do you currently spend putting a roof over your head? Reality is for most FTBs, they are lining landlord's pockets and will have nothing to show for it after several years. I have spent £40,000 on rent in less than 4 years and even in a Shared Ownership scheme, I would still have built at least 25% of that in equity had I purchased the minimum percentage allowable.
Renting is ALWAYS going to be worse than buying, even if you're only buying a SHARE of a home. I encourage everyone to read the lease document, reservation documents and get on the ladder ASAP. Just be smart about it - and you have yourself a cute little stepping stone investment!
Also a lot of what this lady is saying assumes your pay will not increase in line with your staircasing plan. Who is still earning £30k when they're 40, realistically, that's graduate salary. It's the same for anyone who decides to remortgage on their 100% mortgage home - you need to really "move up" in your career if you want to move up in your property :)
They make it look like shared ownership is a cheaper option when buying a house for first time buyers and they make it seem very attractive but it works out to be a lot more expensive.
true! you much rather pay bigger mortgage and you are investing. Service charge are awful. You have no control.
Hello could you please explain more on selling the share of bought property?
Hi Natasha, thanks for your video. Any chance of another one, but showing us the pros and cons of Help To Buy, please?
It is all cons according to me. Real estate is a market of cartels which favours everyone other than the buyer. If one happens to be a first time buyer, one is a looser.
Your video was really helpful for me to understand shared ownership. Thank you.
Thank you so much for explaining how it's really work 👍 I was almost decided for it..... 😳😒😒
What r ure thoughts on the help to buy scheme??
So glad, I’ve come across this Nicole. Think I’ll be in touch very soon for some individual sound advice from you!
I’m hosting a Decision Making Clinic: How to Make Money Making Decisions in Property Investment on Monday 26th October 2020 at 6:15pm UK Time.
I’d love for you to come!
Here’s the link to register ➡️☺️ ncrealestate.co.uk/free-sessions/
What you are forgetting is that we are about to Brexit, and the chances of property prices dropping are very high. This would then mean the shares and rent would become much more affordable. Swings and roundabouts.
And what you are forgetting is that, as a minority investor in a shared ownership your options will be mostly at the mercy of the majority shareholders (e.g. they will still dictate the rent payable and have you by the balls should you wish to negotiate it downwards. You'll also still get screwed on service charges, to name but two major weak hands) - regardless of whether house prices rise or drop.
Thanks a lot for your time that you explained this.. Really appreciated!
I’m hosting a Decision Making Clinic: How to Make Money Making Decisions in Property Investment on Monday 26th October 2020 at 6:15pm UK Time.
I’d love for you to come!
Here’s the link to register ➡️☺️ ncrealestate.co.uk/free-sessions/
Hi, Thank you for that, I was actually looking into shared ownership to start me and my wife off to get our own space, but listening to that has put me on doubtful edge.
I will re-discuss this and will most likely conclude on doing your advise
Where are you looking to buy JP? Definitely see if you could buy 100%
Very informative video thank you! So frustrating at the moment, I’m just out of London in Hertfordshire and the prices are absolutely ridiculous. Even though I earn reasonable money, as a single guy Ive got zero chance of getting a full mortgage myself for anywhere that isn’t a flea pit! Looks like I’m doomed to rent forever unless brexit brings down the house prices!!! 😂
Thank you for the info, very helpful. Eye opening. ❤
The main benefit of shared ownership is that it enables individuals with low borrowing power to move into properties which they could otherwise not afford to occupy - so I don't understand why you are so frustrated. OF COURSE buying 100% is better but if the house you need is £400,000 (to use your example) which would buy a decent-size house in all but the most expensive areas of the UK, and you only earn £30,000 per annum, then a more valid comparison would be "Shared Ownership v Renting" ......................... In the UK, house prices tend to double every eight to ten years, so your share in the equity also increases in value. (And yes, I know that there are occasional blips in the market.) If you rent, you don't get the benefit of any increase in the value of the property which you occupy. So chill-out Natasha; stress is the silent killer !!!!!!!!!!!!!
Shared ownership should really be used to get on property ladder. Let the market growth give you the equity. Sell up and buy somewhere else outright with your equity.
well i was going to ask if it was good for that because that is my plan to buy an intial share then as soon as theres equity sell up and buy a property with 100 % mortgage on another property
Yes! That's an idea, but it's difficult to get out of your share... video to follow over the next few weeks. See my comment above Channette, let me know what you think :)
NC RealEstate why is it difficult to get of the share? Isn't just the same as normal selling. Just done though the housing association as a preowned property? Just wondering
If the housing association can't sell it after the time scale set out in your lease then they hand it back to you to sell 100% of it. You are then responsible for 100% of the agency fees (even though you are technically selling your own %) plus the more expensive legal fees associated with buying out the 100% share and then completing with the new purchaser on the whole property.
I cannot save for 100 % deposit so my plan was to buy an intial share then as soon as theres equity sell up and buy a property with a 100 % mortgage on another property what do you think of this
How about looking into the Equity Loans via help to buy? You save a 5% deposit, the Government helps you with a 20% loan on the property and then you get a mortgage for the final 75%. The benefit is a 75% mortgage is far far cheaper interest wise than a 90% mortgage or a shared ownership mortgage. I.e you can currently get rates around 1.5% whereas shared ownership mortgages are in the 3-4%'s. The only thing is you have to pay off the Governments share within 5 years otherwise you have to pay interest. So buy in an area where property prices are going up and then within 5 years remortgage and use the increase in value to repay the Government :)... would it be helpful to do a video on this?
Natasha Collins this sounds like good advice. A video on this would be great.
Forgot to mention that there is lots more information and help with shared ownership on the Facebook page and the utube page ‘The National Leasehold Campaign’
Thanks. If you buy a flat won’t you have to pay a service charge anyway?
But not 75% rent as well which they could put up?and Don't forget staircase will not be valued at original flat valuation but on the current valuation which more than likely gone up
can you give your opinion on areas in greater London to purchase an apartment or house that has a good chance of increasing in price. Anywhere in the region of 250-350k
Thanks for the information. If I am paying rent anyway and I only have a small deposit with low borrowing potential due to earnings, would it not be in my favour to pay the same amount I would in rent but have a stake in the property? If property prices increase I can sell of my percentage later down the line if circumstances change and use that to be in a better position than I would have been if I was paying rent only and struggling to save?
Yes that could be the case but it seems these new builds are having an extra first time buying premium built into the purchase price. Only the most affluent sought after areas have found a price increase and other areas valued far less then when bought new. The developer can raise the initial price because they get the sale of the property percentage and sale of the ground rent to investors and because you will only buy 25% it is affordable to you... so the inflated price is not noticed. But in the right circumstances, like all leasehold, you might get a short term price increase, then sell on and make a modest profit. But if you look at it as and investment opportunity then do your homework. SO is cited as ownership but its a leasehold, so you staircase to 100% and then you own 100% of a lease! Read a lease ... it says "tenant" not freeholder!
Very informative video, thank you!
Does shared ownership mean that you will live with other people in the same home?
How does it work with shared ownership with a council property with a discount
I’m hosting a Decision Making Clinic: How to Make Money Making Decisions in Property Investment on Monday 26th October 2020 at 6:15pm UK Time.
I’d love for you to come!
Here’s the link to register ➡️☺️ ncrealestate.co.uk/free-sessions/
Hi Natasha, Good video thanks!
This may sound like a stupid question but I've not been able to find an exact answer! We have a shared ownership house and at the time of buying it, it seemed the only option for us. Our house was valued at £200,000 and we brought 50% - We think the house is currently worth around £250,000ish and are looking to move away from shared ownership and away from this house.
My question is how does the profit work? If the house sell's for £250,000 and we owned 50% do we walk away with £25,000 in our pocket? (as that would be 50% of the profit?)
And secondly - We both earn more than we did when we brought the house and could get a mortgage for the full value if we wanted to - But as I said we want to move - Would it make sense to buy out the other 50% and then sell, Or just sell the 50% and start over again?
If you hadn't guessed we've never sold a house before so we've no idea what we are doing :D
Thanks :)
Yeah im looking answer for this one too
Yes you walk away with 25k in your pocket, you own 50% of the property soyou get 50% of the net proceeds of the sale. No point buying the other 50% as it will cost you £125,000, so you don't make any money when you sell 100%. All you do by buying the extra 50% is just create an extra step in getting rid of the property which may have costs to that extra step. Sell up, 25k a good return. Get a normal mortgage and stay away from this scam unless you want to invest cos you know the housing market is going up
Hi
Should I buy a house with share ownership or not? I really confuse about share ownership. It’s my first home so I can’t afford to get the 100% home. Could you please tell me it’s good or bad idea to get share ownership? Thank you
•gacha cutie Bear• hello, did you get to use Share ownership scheme? I’m researching about it and on the same situation as you are
this video was so helpful, thank you!
Hi, I’m planning to get into share ownership with my brother, but I’ll goal isn’t to own 100%, as we only want own the property for 3 years then sell our shares. Is this ok
Feyi Bolarinwa just be wary of the market, the shared ownership provider will always want to make sure that the property is sold on for more so that they can continue to make money. So make sure you ate buying in a stable market (not one that will go down) and that there is demand in that area for shared ownership so that there is a market to sell it on in a few years time.
Good question
Hi thanks for the vid it just confirms
my complete aversion to shared ownership.
One thing, if by some quirk a person managed to
aquire the full 100% ownership.. would the property still
be leasehold?
Yes! Avoid.
Yes
Not good is it.
Especially if the rent can go up
Great video thank for the information.
It's just a big scam... that's what I think.
Thank you, this was very helpful.
What is service charge?
Gregory May it’s the monthly payment to pay to the management that takes care of the building for the lift maintenance, cleaning, repairs and else
Thanks for the video it's really useful
I thought that it was pretty much a scam and you've confirmed this
Can a shared ownership have a lodger?
No
Actually yes they can as long as you also live in the property, but you'd have to check with each individual contract.
thank you
How fucking crazy is it that we need government help to buy our own homes? Guys like me who do 60+ hours a week and can't even afford a real home for my family.... Which I waited until I was in my 30s to have because I wanted to own a home first 😂
Do not do it!
its very grey area and serve only both greedy landlords and banks
snooker lol
Staying away from Shared Ownership for sure 100%
At 0:08 I thought you are about to lay an egg