Shared Ownership Solicitors
Shared ownership helps people onto the property ladder by allowing them to purchase part of a property.
The process of buying a shared ownership property can be more complicated than a normal purchase and it is important to understand the implications of buying in this way.
At Bell Lamb & Joynson, we have extensive experience in representing clients in shared ownership purchases. We understand the importance of ensuring your transaction goes through without delays and we will always work proactively to avoid these wherever possible and to deal with any difficulties as soon as they arise.
Shared ownership involves buying a property jointly with another party, usually a housing association, local authority or registered social landlord. You will usually start by owning between 10% and 75% of the property and the agreement you will enter into will include provisions for the future, allowing you to increase the proportion of the property that you own. The method of calculating payment and increasing your share of ownership is known as staircasing.
You will usually take out a mortgage to finance the purchase of your share and you will be required to pay rent on the portion of the property that you do not own.
The agreement between you and the other owner will be complex and it is vital to have an expert in shared ownership housing to advise you. Our shared ownership team understand what to look for in this type of transaction and can advise you on the conditions that you will be agreeing to. Our services include:
- Representing you in the purchase of a shared ownership property.
- Representing you in the sale of a shared ownership property.
- Providing advice and representation in respect of increasing your share of a shared ownership property using the staircasing provisions in the original shared ownership agreement.
Our shared ownership experts will be happy to explain this complex subject to you clearly and to answer any questions you may have.
Get in touch with our shared ownership solicitors in Liverpool, Runcorn and Warrington
You can request an instant fixed fee quote online in just 60 seconds. Once you have your quote, there is no obligation to move forwards with us.
You can also contact us directly via our website, call 03444 124348, or pop into one of our offices in Liverpool, Runcorn or Warrington where we will be happy to discuss your shared ownership conveyancing needs.
How shared ownership works
Buying a shared ownership property
Buying a shared ownership property can be ideal for first time buyers who might otherwise be unable to own their own home. It can be cheaper than renting and you will end up owning some or all of your property.
If you wish to buy a shared ownership property, you can check with a Help To Buy agent to see where there are available properties. You will also need to ensure you will be able to obtain the mortgage offer you will need to fund the purchase.
A shared ownership property is leasehold, although the property could be a house or a flat, and you will generally buy between 10% and 75%, paying a capped rent on the rest which is based on the value of the property.
You can sell your shared ownership home at any time if you wish.
Selling a shared ownership property
Even if you own all of your property now, you should still check the terms of your shared ownership agreement to see whether there are any restrictions or rules governing the sale.
If you only own part of the property, then the housing association will have the right of first refusal to buy from you or the right to find a buyer who will also be purchasing on a shared ownership basis.
This means that you will be selling to a smaller potential market than with an ordinary property sale. The sale price will be calculated in accordance with the market value at the time of sale.
Increasing your share in a shared ownership property
It will be open to you to buy a larger share in your property during your ownership. The shared ownership agreement will include staircasing provisions that will set out how this is to be done and the rules that will apply.
You will usually be required to purchase a minimum of 10% at any one time and there may be a limit on the number of times you can do this. For example, you may only be allowed to buy an increased share three times and it may be the case that you can only increase your ownership the third time if you intend to increase it to 100%.
When you wish to buy a further share, you will need to pay for an official valuation of the property to be carried out. This valuation will be used to assess how much you will need to pay for the percentage of the property that you wish to purchase.
Key issues to be aware of in shared ownership property
There are a number of points to be aware of before entering into a shared ownership arrangement:
Maintenance charges - because the property is leasehold, you will be required to pay maintenance charges every month. You need to be aware of how much this cost is as well as what potential there is for it to be increased.
The cost of increasing your share – as well as finding the extra money to increase your share in the property, you will also have to pay the associated costs, which can mount up to a substantial sum. This will generally include mortgage fees, legal fees, notice fees, potentially Stamp Duty and any outstanding rent and service charges.
Lease restrictions – the lease will contain a number of rules, such as the prohibition of subletting and restrictions on carrying out alterations. You may have to ask consent for anything you want to do, which could involve the payment of notice or administration fees to the landlord.
Difficulty in selling – because you will be limited to selling to your housing association or one of their buyers, it may be that you find it harder to sell or the process could take longer as buyers try to find a mortgage.
Financial issues – you will still have substantial monthly outgoings with a shared ownership property, made up of your mortgage, rent and maintenance charges. These are likely to increase over time.
Negative equity – there is a chance that your property could end up being worth less than you paid for it. This is particularly the case with newbuild homes, as you will be paying a premium for a brand new property and this will not be recoverable. If you move soon after buying, you might not achieve as much for the property as you paid.
Get in touch with our shared ownership solicitors in Liverpool, Runcorn and Warrington
Our solicitors can give you in-depth advice about buying a shared ownership property and will be happy to answer any questions you may have.
You can receive a fixed fee quote online in just 60 seconds, with no obligation to use our services.
Alternatively, you can contact us via our website, call 03444 124348 or pop into one of our offices in Liverpool, Runcorn or Warrington.