Shared ownership... Thoughts

What are your thoughts on shared ownership? Basically buying a stake in a house (e.g. 25%).
I'm conflicted. It seems like a good idea and a realistic way for me to get onto the property ladder. But how easy or difficult would it be to sell that stake?

Reply 1

Anonymous #1

My parents were in shared ownership for years.

They were able to live in a very affluent area that they otherwise wouldn't have been able to live in, but it's very expensive.

Not only do you pay mortgage repayments on your share, but the rent can increase. You also have maintenance charges and wider gardening fees etc. Just because you own a percentage, even if it's a majority, you don't hold the same rights as someone in freehold. There was a dispute between two of our neighbours and they were told that if either party reported antisocial behaviour, share or not, you could be out. That's quite scary and as a result my parents decided to sell up and move somewhere cheaper.

My parents have advised me to not do it and instead buy some property like a flat, rent it out to pay off the mortgage and hold ownership but then rent where I actually want to live.

Reply 2

claireestelle

22

Original post by oglez92

What are your thoughts on shared ownership? Basically buying a stake in a house (e.g. 25%).
I'm conflicted. It seems like a good idea and a realistic way for me to get onto the property ladder. But how easy or difficult would it be to sell that stake?

I'd only go for it if you have a solid plan to be able to buy more of the equity in a decent amount of time, it'd be harder to sell if you wanted to move on and then you'd have the ground rent. If you can own 100% of somewhere that is cheaper then I'd chose that over shared ownership of an expensive place.

Reply 3

Anonymous #1

Original post by claireestelle

I'd only go for it if you have a solid plan to be able to buy more of the equity in a decent amount of time, it'd be harder to sell if you wanted to move on and then you'd have the ground rent. If you can own 100% of somewhere that is cheaper then I'd chose that over shared ownership of an expensive place.

I agree with everything else apart from it's harder to sell - most shared ownership properties sell extremely quickly in the places I've looked.

Reply 4

oglez92

OP

14

Thanks guys. I think that's made me even more doubtful about it all.
Might as well rent or save up a bit more to buy outright.

Reply 5

Anonymous #1

If there's the option, always aim to buy outright. It's yours then and nobody can dispute that. You also won't be paying any 'dead' money.

Tbh, if you're in a position where you can hold out, definitely do. Corona, Brexit and immanent recession will see prices go down. Build up your savings in the mean time.

Reply 6

oglez92

OP

14

Original post by Anonymous

If there's the option, always aim to buy outright. It's yours then and nobody can dispute that. You also won't be paying any 'dead' money.

Tbh, if you're in a position where you can hold out, definitely do. Corona, Brexit and immanent recession will see prices go down. Build up your savings in the mean time.

Good point. See I finished my degree last year so most would argue I should have moved out by now. I was going to move out next weekend in fact, and was going to rent somewhere about 25miles from my parents place. But with so much uncertainty about the pandemic and the possibility of a second lockdown, it makes more sense to stay at home and save up my deposit more. And to observe and research the market.

Reply 7

Anonymous #1

Original post by oglez92

Good point. See I finished my degree last year so most would argue I should have moved out by now. I was going to move out next weekend in fact, and was going to rent somewhere about 25miles from my parents place. But with so much uncertainty about the pandemic and the possibility of a second lockdown, it makes more sense to stay at home and save up my deposit more. And to observe and research the market.

Seriously don't worry about what society projects should be a moving out age.

80% of my friendship group post uni rented and they now feel like they're stuck renting for a long period or they've moved back home to save for a deposit.

Depends if you're bothered about owning. I know some people who genuinely have no interest in owning anything, and their renting suits them as they like to experience new places every few years.

Whilst I was disadvantaged at first, still living at home, I've saved up a lovely pot of money that will get me on the property ladder quicker and in a better position than a lot of my friends who rented for the sake of living out.

I'll also add I understand it's a privilege that I have that I feel safe in my home environment and that my parents are happy to have me as not everyone has this option.

Saveeeeeeeeee, live at home. Use the pandemic as an excuse if you want. Nobody will judge someone living at home to save a deposit, trust me.

Reply 8

oglez92

OP

14

To be honest I do want to own but not yet.. quite. See I'd like to try before I buy. Rent in the area first to see what it's like. It's more complicated if you've bought a place and have a mortgage.

Most of my friends are in similar situations, or they've bought with their wives/partners.
My brother pokes fun at me for living at home when he bought a house (which he's now sold) but he only managed that because he bought with a friend.

Reply 9

Anonymous #1

These are all options.

I know people who moved out at 25 and they were only able to do this because they're sharing with a friend, in most cases a sibling. Then they feel they have the right to look down on someone of a later age who's capable of buy ing themselves.

You make a good point about renting and getting a feel for a place though, it just depends on your take home pay and how much you can save whilst renting etc.

Reply 10

Surnia

20

Original post by oglez92

To be honest I do want to own but not yet.. quite. See I'd like to try before I buy. Rent in the area first to see what it's like. It's more complicated if you've bought a place and have a mortgage.

Most of my friends are in similar situations, or they've bought with their wives/partners.
My brother pokes fun at me for living at home when he bought a house (which he's now sold) but he only managed that because he bought with a friend.

Dont waste money on rent to see what an area is like. It's far easier going round the vicinity on foot to find out where the facilities and shops are, or to sit in your car at different times of day near a property to see the foot and vehicle traffic is like. That's what is recommended anyway before taking on a place. It's what I did before buying.

Shared ownership... Thoughts

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