1. Is it more difficult to obtain a mortgage via Shared Ownership?
- Some people believe that it is more difficult to obtain a Shared Ownership mortgage in comparison to an ‘ordinary’ mortgage. There are now an abundance of lenders willing to lend on Shared Ownership properties with new lenders continuing to enter the market. You can secure a mortgage via a broker or approach a high street lender, the process should be no more difficult than a 100% mortgage and you only having to raise as little as a 5% deposit on the share you are purchasing.
2. Is Shared Ownership a more expensive way to buy a home and or cheaper than renting?
- Monthly payments for Shared Ownership in many instances are less than privately renting and purchasing a home outright. Buying a home does cost however so does renting a home. With Shared Ownership, you have the benefit of owning a stake in your home. It is generally a cheaper option to purchase a Shared Ownership home when comparing against the costs of privately renting and purchasing outright. However, it will depend on the location you are purchasing in and below is an example of this is;
- To purchase a 30% share of a 1 bed Hyde New Homes apartment in SE15 (Woods Road SE15) is £1,115per month this includes mortgage, rent and service charge payments and is based on a 10% deposit. To privately rent a new build 1 bed apartment (Evans Cook Close SE15 Rightmove 14.7.17) within a half a mile of the SE15 Shared Ownership development the monthly rent is £1200. In the majority of cases Shared Ownership also works out less them purchasing 100% of the home so a win-win all round and a great way to get onto the property ladder.
3. Does Shared Ownership mean I have to share my home with someone?
- The ownership of the home is shared with the Housing Association unless of course you wish to share your home with a family member or friend. You own a share in your home and as your circumstances allow and if you should wish to do so you can purchase further shares in your home and eventually own 100% of your home.
4. I would never be able to raise a deposit
- With Shared Ownership, you only need to raise as little as a 5% deposit on the share that you are purchasing. For example, if the full market value of an SE15 Shared Ownership property is £390,000 (Woods Road 1 bed example) and you purchase a 30% share then the deposit required would be £5,850. Allowing you a great opportunity to get a step onto the property ladder. In comparison purchasing on the open market the 5% deposit requirement would be £19,500. Solicitor fees would be payable in addition to your deposit.
5. Are you stuck with a home that you can never sell?
- For some customers, Shared Ownership is a stepping stone towards 100% ownership and for others as circumstances alter they may wish to sell on their home. You can sell your home at any moment in time you will need to contact your housing provider and they will then advertise your share to others wishing to get a step onto the property ladder. The property will be sold at the current market value. If you own 100% of your home then you can sell your property privately.
6. Do you have to live or work in the Borough that you wish to live in?
- For some schemes priority maybe given to those with a connection to that Borough however you can apply for Shared Ownership in any Borough and you can find details of available homes at www.hydnewhomes.co.uk