The government supported home-buying scheme, which offers the opportunity to buy a share of the property from a housing association, is called Shared Ownership. It applies not only to new build complexes but also to resale homes.
Shared Ownership scheme mean that the purchaser only pays the mortgage for his share of the home. The rest of the rent is paid to the housing association. Using this scheme, the mortgage needs a considerably less amount of money. Also, the amount for making the required deposit is much lower than with a direct purchase.
|Shared Ownership available on properties until 2023||Shared Ownership available on properties from 2022|
|Minimum deposit||5% of the share in the property||5% of the share in the property|
|Minimum share of property for sale||25%||10%|
|Minimum ‘Staircasing’||10% share annually||1% share annually, with reduced fees|
|Who pays for repairs||The buyer||The buyer receive support from his landowner for necessary repairs for 10 years|
|Exclusivity period for landowner to sell||8 weeks||4 to 8 weeks|
To put it simply:
*If desired, buyers can increase their share in the home. This process is called staircasing. Typically, this process can continue until the tenant owns 75% of the property. It is very rarely 100%.
Requirements to use a Shared Ownership scheme in Kent:
*Eligibility criteria may vary per housing association and therefore you should always check the exact criteria with the developer or housing association responsible for the exploitation of the property.
Shared Ownership Kent gives the chance to expand your portion of real estate possession whenever you are ready. This process is called staircasing. Prior to purchasing a home, ensure your housing association allows you to use this opportunity. Commonly, the provisions of the rent accept that staircasing happens in tranches of at minimum 10%. Sometimes you can quickly buy the whole wanted piece of the property. The cost relies upon the current worth of the house. To possess 100% of the property, actually take a look at the agreement, as some lodging associations limit this choice to 75%. Always discuss the factual details with the developer.
How does staircasing work?
Using the staircasing scheme, you can get 1% of the house at a time as an additional part. The expense of this share depends upon the current market cost of the house. To get a trustworthy price assesment, ask a certified appraiser who will advise the housing association how much should be charged for the additional share in Shared Ownership houses that you really want to buy.
Also, look out for various expenses. Even though the additional part is already part of the existing home, the purchaser needs to restructure the home mortgage or pay stamp duty. The usual amount of costs you will spend during the staircasing is around £2,000. In any case, it can change due to some individual factors.
|+ Low deposit. You can purchase the home you want by paying a much lower mortgage than when buying the whole property.||- Unstable cost. Although rents are initially low, they can rise over time.|
|+ Staircasing. You can increase your share of home ownership anytime.||- Extra fee. You will also have to pay for land and property maintenance.|
|+ Easy sale. You can sell your piece of the property whenever you want.||- Repair restrictions. To upgrade your apartment, you need a permit from the housing association.|
|+ Own choice. You decide for yourself how much of your property you want to own.||- Prohibition of subletting. The Housing Association may place restrictions on your renting out property.|