if u cant afford to buy a house is the shared owner scheme a good way to start?

Question

and how do i go about finding information on this do i have 2 go 2 ma local council?

Answer 1

It depends on the scheme, and there are lots about now.

Generally they are bad in that you take all the risks while the owner of the rest of the property takes none, the cost is generally not much lower either.

There are some later ones where you buy a percentage of the property now, and the developer holds the rest at no cost to you for a period of time ( I've seen 5 years as common). The split is usually 75%/25%.

At the end of the time you buy the remainder, how ever the price of the remainder is the market value at that time, not what is was when you originally bought the property.

Answer 2

I only know the concept of "shared ownership" and if a client came to me to help them close such a deal, I would require them to sign a document before witnesses and a notary stating that they understood that I thought it was a bad idea.

Here's the problem I foresee. Buying a house is generally a 30 year commitment, although the average time people stay in a house is probably closer to five, and the average time before refinancing a mortgage is probably three.

Two different people or couples are going to want to change mortgages or houses at different times. If your partner wants to refinance now to get some cash out of equity and you don't, and they're willing to increase the interest rate to do it and you're not, that's a problem.

If your partner wants to sell and you don't, that's a problem.

If your partner wants to put $10,000 into renovating the kitchen and you don't, that's a problem.

If your partner wants to put a swimming pool in the back yard and you have a six month old baby, that's a problem.

If your partner doesn't pay their half but doesn't feel inclined to move, you either pay for their half or both halves get foreclosed on.

It's hard enough to make shared ownership work for married couples. There are people that make a fortune telling people how to buy houses cheap from couples that are divorcing. How could it possibly be better for mere friends, acquaintances, or total strangers?

Answer 3

The only way I could afford to buy a house in London was to buy it with a friend. We went through a scheme called Share to Buy. Have a look on the internet. They are really helpful!

Answer 4

i have shared ownership, it works for me and i can buy out the other half if my circumstances make me able to afford, i just pay rent on the half owned by a housing assosiation, if your council cant help, check on housing assosiations some of these have some good schemes going to help people onto the property ladder, the only fall back i have found with my shared ownership is that you alone are responsible for all repairs on the property which i find a little unfair, also check to see if in future years if you wished you could buy them out.

Answer 5

I think you should just carry on saving. Save £20,000, it will take no more than 5 years, a £15,000 deposit on a nice little flat will get you on the property ladder in an up and coming area, once the equity in your house builds, you can use it to mortgage out another one. Do not go into this with a friend. or anyone for that matter. its not worth the hassle, trust me. Plus my dad about 6/7 houses and it has worked for him. He is retired at 52 and living in Thailand. As long as you got a depoist for a little flat and couple of months mortgage in yoru bank too with a steady job your already half way to becoming a millionaire mate. if you use your head that it is.

goodluck x

Answer 6

no. I looked into this with my local council and found that i would never own the property and when you add the repayments for the mortgage and the rent together it comes to more than what a mortgage for the full amount would. My advice is to save and save.

Answer 7

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Answer 8

what country do u live in? that would help ppl answer the question better

Answer 9

never

Answer 10

No.