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shared ownership
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Do you have to meet certain criteria in order to be eligable to apply for a shared ownership property with the council? And are there any catches to it or things i should know about before applying?
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Most Councils have their own rules, but on the whole, the scheme exists to enable first time buyers to get onto the property ladder. When I worked for one of the Housing Associations, our SO houses were marketed for sale like normal properties through estate agents. Your first port of call will be your local agents. Tell them you are interested in these type of properties. You will probably find stiff competition in buying one! You need to be able to raise the mortgage for the share on offer, which can range from 10 - 25% (usually). you may get properties where a larger proportion is on offer. You need to work out if you can afford both the mortgage and the monthly rent payment, which sometimes works out more than a mortgage on its own! If you decide to buy, you can buy just the share on offer, or, by agreement with the vendor, you can do what is known as staircasing. This means that you can buy the share on offer, plus an extra share at the same time, thus increasing your mortgage, but decreasing your rent. As you become better off, with salary increases etc, you can usually apply to staircase further, usually in blocks of 15 - 25%, until you own the whole property. When you come to sell and move on, you usually have to offer the property back to the Housing Association - they normally say no thanks, it's a courtesy thing and they do get first refusal! I would counsel you to think very carefully. SO properties are not usually in the most salubrious parts of town (well, ours weren't) and you run the risk of being an owner-occupier in the middle of a run-down council estate. I'm not decrying council estates, but in my eight year experience, I can only say be careful - you might not like what you find!
Possibly - you might find that if the property is in an 'ex' council area (ie where plenty of right to buy and SO has gone on for a few years), that the neighbourhood would have 'matured' (that's an official housing term, not just me being snobby, by the way!) and you'd get less problems. We used to find that where there was still a high proportion of rented property in relation to owner-occupier, there were more problems, usually when people came to sell on - you might not mind living next door to a rental with a rusty car in the drive and several broken settees, but your prospective purchaser certainly might! Let me put it another way, Nickie. If, after doing your sums, you can afford rent plus mortgage, I'd investigate imaginitive mortgages through a broker (not b. socs) prepared to lend you enough to buy a whole property. I would never go SO myself, having spent 8 years dealing with it at the sharp end!
Lots of housing associations actually have shared ownership properties built. There have been several in my area which have been nice. However, remember with shared ownership, you are restricted in rather the same way as you are with renting. If you want to do anything structural, you will have to ask the Housing Association. If you are in a flat, you won't be able to keep pets. When you want to buy a further portion of the property, you have to accept the price that the Housing Association wish to sell it to you at. The combination of rent and mortgage often adds up to just the same as it would if you bought the whole thing on mortgage. They are aiming at purchasers that can't raise the whole mortgage. Key workers (eg. teachers, social workers, health workers) get a higher priority if the properties are in demand, and also single parents or young couples forced to live with in-laws etc. as they can't get a mortgage.
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