Shared Ownership (1 Viewer)
- Thread starter shmmeee
- Start date
clint van damme
Well-Known Member
One of my mates is looking to buy his first house and has looked at these.
You basically pay part of the mortgage and also a rent. After so long you get chance to take over the portion of the mortgage you are paying rent on. So on 100,000 you service a 60,000 mortgage and pay rent on the other 40,000 portion of the houses value.
He doesn't think he'll go down that route but reckons they're better deals than the help to buy schemes.
fernandopartridge
Well-Known Member
When me and missus bought our house we bought 75% of the equity. The homebuilder held on to the remaining 25% interest free for 10 years which you could buy out at any point.
When buying out the 25% it is at the current market value rather than the value as at the point of original purchase. I paid a bit less than originally envisaged for the original 25%, but my overall loss of equity is greater than the homebuilder's.
Overall, I wouldn't recommend as the risk falls disproportionately on you, new houses are overpriced as well and instantly lose value (like brand new cars).
Then again, I got to buy a house I probably couldn't afford in 2008 which I can comfortably afford now.
Bumberclart
Well-Known Member
Don't buy a new house. The build quality is utter garbage.
Mate of mine paid £350k, for a 5 bed detached in Yorkshire 18 months ago. He's just gone legal on the builder, as a surveyor has proved that the roof trusses are not rated for the weight of tiles on the roof, meaning it could cave in.
The surveyor told him that most big builders are using materials to last just over the 10 years NHBC guarantee. After that, its your problem.
Mate of mine paid £350k, for a 5 bed detached in Yorkshire 18 months ago. He's just gone legal on the builder, as a surveyor has proved that the roof trusses are not rated for the weight of tiles on the roof, meaning it could cave in.
The surveyor told him that most big builders are using materials to last just over the 10 years NHBC guarantee. After that, its your problem.
SBAndy
Well-Known Member
Someone I know was in their new house for 10 months and all the ceilings fell through.
Nick
Administrator
The thing with new builds as well is how close together a lot of them are and the garden sizes. There are some in Corley that are going to be about 650 - 700k I think and although they look pretty because they are new builds you could probably fit a BBQ and shed in the back garden and you will probably take out your neighbours washing when you flip the burger.
On the other hand, could you get something a bit "shitter" that you could do up yourself over time?
On the other hand, could you get something a bit "shitter" that you could do up yourself over time?
rob9872
Well-Known Member
The con is based on affordability. I'd advise not to if you have an alternative option. Just a few quick observations:
The half you rent will be almost as expensive as the half you have on mortgage, so may as well mortgage all of it (if you can find a bank willing to loan you the full value).
Another huge downside is any improvements you make over time, you pay twice for, since it increases the value of the home and therefore their portion too - not only for the annually assessed rent, but also should you want to conclude the purchase of the remaining 50% it will now be valued higher. You purchase at eth current market rate not the rate when you buy your initial 50%.
Most are often leasehold too. Usually 125 year lease, but that does have a value to purchase the freehold and would diminish the value of your property in a generation or two (assuming you plan on leaving it to the kids) as the lease life reduces.
The half you rent will be almost as expensive as the half you have on mortgage, so may as well mortgage all of it (if you can find a bank willing to loan you the full value).
Another huge downside is any improvements you make over time, you pay twice for, since it increases the value of the home and therefore their portion too - not only for the annually assessed rent, but also should you want to conclude the purchase of the remaining 50% it will now be valued higher. You purchase at eth current market rate not the rate when you buy your initial 50%.
Most are often leasehold too. Usually 125 year lease, but that does have a value to purchase the freehold and would diminish the value of your property in a generation or two (assuming you plan on leaving it to the kids) as the lease life reduces.
shmmeee
Well-Known Member
Yeah so I looked into it and the closer you look the worse it is. Didn’t realise you don’t own the freehold until you pay 100%, or that rent can be increased or quite how much it was. Anyway it’s going to take a while for the wife to buy me out and until that happens I’m not eligible.
My limit is about £150-160k and really I need three beds, not seeing much outside of the dodger areas. What do people do? Just rent?
My limit is about £150-160k and really I need three beds, not seeing much outside of the dodger areas. What do people do? Just rent?
Nick
Administrator
A couple that dont look too bad
http://www.rightmove.co.uk/property-for-sale/property-72143846.html
http://www.rightmove.co.uk/property-for-sale/property-71960495.html (if you ignore the decor)
Or if you feel really brave and want a challenge
http://www.rightmove.co.uk/property-for-sale/property-64393045.html
We were quite lucky in that we managed to find something like that last one that had been repossessed and then just gradually worked on it. Loads of hard work but will end up having some money in it if you ever want to sell
D
Deleted member 5849
Guest
Jesus. Who decided that was a way to furnish a semi-detached in Holbrooks?!? The mock pillars are an interesting addition out front, too!
(The Radford one doesn't look too bad at all really, assuming the bathroom's cosmetic)
shmmeee
Well-Known Member
Just find some tart with a few quid
Isn’t it supposed to be money first then love? Knew I’d fucked something up.
richnrg
Well-Known Member
Looks like the set for the film 'Titanic' inside
richnrg
Well-Known Member
I can imagine myself sitting there after having shot a couple of elephants in my pyjamas....(cue Otis)
fernandopartridge
Well-Known Member
Rooms are tiny. Anything privately built in the 80s / early 90s is.
richnrg
Well-Known Member
people were smaller then
shmmeee
Well-Known Member
They all are. Every “three bed” I’ve seen you’d be lucky to get a bed in room 3.
WHERE DOES EVERYONE LIVE?!?!?
Nick
Administrator
Decent space in here : http://www.rightmove.co.uk/property-for-sale/property-71348513.html
Main bedroom already decorated for you
Main bedroom already decorated for you
Rusty Trombone
Well-Known Member
Liquid Gold
Well-Known Member
I imagine Alan Partridge's place is just like this
fernandopartridge
Well-Known Member
Move up north. I've got 3 double bedrooms!
shmmeee
Well-Known Member
If it weren’t for the kids I’d do that.
I whine but when I was looking at Southampton by budget was £1k/month rent just to get a three bed. Here that would get me a massive house. Swings and roundabouts I guess. You just notice just how much shit housing there is when you’re looking. Some of the places built in the likes of Stoke or Tile Hill frankly don’t look like they were even designed for humans.
I think my new political cause might be improved standards for new estates. Fuck the green belt, give people gardens and parks with their houses and have a green everything.