Why shared ownership could help you on to the property ladder
PUBLISHED: 09:39 06 July 2020 | UPDATED: 09:39 06 July 2020
Buying your dream home in Cambridgeshire could become a reality. Brand and marketing manager Tracey Drake and sales manager Lee Webster, from Flagship Homes, shed light on their shared ownership scheme
Q: What is a shared ownership?
A scheme aiming to benefit those not currently owning a home by giving them the opportunity to buy a share of a new or resale property. They can take out a mortgage on the share they own and pay rent to a housing association on the remaining share. So, for example, if a property is worth £200,000 and they buy a 50% share, then they only need a mortgage of £100,000.
Q: Is a deposit required?
Yes – but that can be as low as just 5% of the price of the share you are purchasing in your new home. This is much lower than would be required if you were purchasing a property outright.
Q: Can I increase my share in the future?
Yes, you will always have that option. In most cases you can increase it up to 100% until you own the whole property – and you can do it by 10% at a time. As you do so, your rent will decrease.
Q: Who is part buy part rent suitable for?
First-time buyers (of any age), as well as those wishing to downsize. It can also be very helpful to individuals who have experienced a relationship breakdown. It can give all these potential homeowners better access to mortgages as the amount they need to borrow will be lower than average. Furthermore, there is often no requirement to pay stamp duty.
Q: Why is a shared buy better than renting?
Most people rent because they think they can’t afford to buy. But many could actually be investing in buying their own homes instead. Total monthly repayments for those joining a shared ownership of property scheme can be even cheaper than just renting on the open market – and can certainly offer much more security. As long as your mortgage and rent payments are made, then you can live in the property for the duration of the lease, which can range from 99 years to 125.
Q: What other benefits are there?
We often describe our shared ownership properties at Flagship as “oven ready!” This is because they generally have a high finishing spec – with carpets and integrated appliances – so you can move straight in.
Q: Who is eligible for shared ownership?
Anyone who does not already own a home, although you can have a property that is under offer. In Cambridgeshire, your total household income must be below £80,000. There are no age restrictions, providing you are able to get a mortgage or to pay for your share in full.
Q: Will I be supported through the process of buying?
Yes, Flagship Homes is part of a non-profit making housing association. This means the customer is always our main focus and we aim to ensure their journey is smooth, from first contact to moving in. We have a panel of solicitors they can use to keep their legal costs as low as possible and advisers to answer other questions.
Q: What happens if I want to sell?
You can do so at any time and we can help you with that too.
Q: So, what do you currently have available in Cambridgeshire?
We have a variety of two and three-bedroom shared ownership homes for sale, starting at around £200,000, with shares of 45 per cent (although we can be flexible on this). There are properties for sale in Willingham, Swavesey and Melbourn, as well as Papworth, where some are in the process of being built and will be completed by February 2021; these can be bought off-plan or reserved with an early bird, refundable deposit of £250.
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