Shared ownership should i staircase

To help you arrange this, you should speak to a mortgage advisor and broker who specialises in shared ownership mortgages , such as us here at Mortgage Light. We will be able to guide you through the process. We will also review the funding options available to you, ensuring you get the most suitable mortgage product for your circumstances.

There are other fees involved in staircasing, additional to the price of the shares. This cost will vary depending on where you live, the value of your home, the size of the share you are purchasing and cash backs from lenders. You will need to cover the cost of the valuation report, prepared by a qualified RICS surveyor, in order to determine the current market value of your property.

There will also be legal expenses due to your solicitor for the work they do for you. You may also incur some mortgage fees for increasing or remortgaging your share of the property to help raise the additional funds needed to pay for the staircasing.

The cost of this will depend on the deal you obtain and your circumstances. Stamp duty may also be payable. When you first purchase a shared ownership property, you have a choice about how you pay any necessary stamp duty. You can make a one-off payment based on the total market value of the property.

Alternatively, you can choose to pay what is owed for the initial share you buy. If you choose the latter, this cost should also be factored into the total cost of staircasing if applicable. It makes sense to buy as big of a share as possible each time you staircase, due to the admin fees. If you purchase additional shares, you may find that you are struggling with the mortgage payments. There are currently shared-ownership flats on sale on Rightmove, of which are resale properties. Once a home is sold, any profit is split proportionally between the housing association and shared owner.

They would get half of this money, representing their half share in the property, plus a return of their deposit. They would have also paid off a small proportion of their mortgage. Although over three years they have grown their nest egg considerably, unless their circumstances have changed dramatically they will find themselves firmly back at square one.

Martin Fillery, managing director of estate agents Complete Moves, is an expert on the shared-ownership sector. Upsizing from a starter home is tough for all would-be second steppers. For shared owners, who only get a share of any profits, it is harder still. And with London prices flat-lining they could easily walk away with almost nothing beyond their original deposit. Research on the fate of shared owners once they have moved on is limited.

But a survey by Alison Wallace of the University of York found about half of shared owners were able to move on to full home ownership. The rest went back into renting or bought another shared-ownership property. A third of the shared owners Wallace interviewed said they wanted to move but could not afford to. It cannot be regarded as just a stepping stone to full home ownership since it seems only half of those moving home in the sector move on to full ownership.

Wallace believes the solution is to make it easier for shared owners to move from one shared property to another.

However, this process needs to be made much more flexible. Find a Planning Consultant in your local area to help you with a planning application or appealing a refusal. Find a Tradesman that you can trust from your local area with our partners at Checkatrade.

Find an Estate Agent in your local area and review how successful they are at selling homes. If you bought your home using a shared ownership scheme you may be considering staircasing.

This is where you buy further shares in your home so you own more of it. But how much does staircasing cost? What are the steps you have to take? What are the common pitfalls? And should you do it? We look at everything you need to know. Once you have owned your shared ownership property for a certain period of time — set in the terms of your lease but usually one to two years — you can purchase further shares in your home.

This process is known as staircasing. It enables you to gradually build up the amount of your shared ownership home that you own. Read our full guide to shared ownership to find out how this scheme can help you get on the housing ladder. There are a number of reasons that you might want to increase the share of your home that you own:. Pay less rent. By reducing the percentage of your property that you rent from your local housing association you will also cut your monthly rent bill.

Benefit from any increase in house prices. More mortgage choice. Standard mortgages tend to be cheaper. Freedom to sell. However, if your property is still leasehold you may still have to offer it back to the housing association first.

Make sure you check your lease. Many find the hassle and financial costs of doing so outweigh the benefits. And many people view their shared ownership home as a more secure form of renting, with the added advantage of also building up equity in a property.

On top of the purchase price for the additional shares there are several other costs involved in staircasing:. But this is a ballpark figure and varies depending on where you live, the value of your home and how big a share you are buying. When you first purchase a shared ownership property you have a choice about how you pay stamp duty.