How to get your share of Help to Buy Shared Ownership

While house prices in London have stagnated this year those in Yorkshire have risen by an average of about three per cent.This is good news for existing property owners but for those looking to take their first step on the housing ladder or those who have had budgets slashed by divorce and other life events, it is not so welcome.The average home in Yorkshire now costs almost £160,000, though in some areas you can still find terraced houses for £60,000.Among the options designed to help would-be buyers are the government-backed Help to Buy equity loan scheme, the Help to Buy ISA available only to first-time buyers and due to close on November 30 this year, and the less well known Help to Buy shared ownership.The latter is an option that should be explored but with a reminder that rent must be paid on the share of the property you do not own, along with a service charge as shared ownership properties are leasehold. Also bear in mind that if you ever want to sell a shared ownership home you have to do so through the housing association that co-owns it, using its valuation.Housing association Stonewater has new homes available for Help to Buy shared ownership at two new-build sites in Leeds.Timeless at Seacroft, Leeds, features a range of two and three bedroom homes in the grounds of a former hospital. The houses have rear gardens and allocated parking with prices from £71,998 for a 40 per cent share. The monthly rent on the rest is £295.62 and the service charge is £21.87.Serene at Osmondthorpe in Leeds is a collection of three-bedroom houses with gardens and parking. Homes are priced from £85,998 for a 40 per cent share. Along with mortgage payments, the rent on the remaining 60 per cent is £226.87 per month with a service charge of £21.87.

Shared ownership on the rise

Stonewater say that the number of homes bought through shared ownership has risen by more than 130 per cent since 2011. It adds that the scheme is especially popular with first-time buyers who account for around 89 per cent of sales.Paul Negi, Head of New Homes at Stonewater, says: “Shared ownership is ideal for those who want to get on to the property ladder.“For a 40 per cent share you only have to find as little as a five per cent deposit so it’s possible to become a homeowner with just £3,300 pounds of savings and a modest mortgage, putting the security of bricks and mortar within reach of so many more people.”He adds: “There are many situations in which this might be the perfect solution. In Yorkshire, shared ownership is open to individuals or families with a household income of less than £80,000, who would not be able to afford a suitable property for their needs on the open market.“This could apply to first-time buyers who have been priced out of the market or those who once owned a home but have found themselves divorced or separated.”One of the advantages of shared ownership is the ability to buy further shares in the home if circumstances change.

Staircasing

Buyers may begin by buying as little as 25 per cent of a property but they can go on to purchase further shares with the possibility of owning the entire property.This process is known as staircasing. Be mindful that you pay another lot of valuation, legal and mortgage fees when you staircase.Paul Negi adds: “As long as you are able to find the deposit and around £2,500 for legal fees and moving expenses, you have a good enough credit history to be eligible for a mortgage and can afford the rental payments, then we may be able to help you find a place to call home.”To find out more about the Stonewater Homes shared ownership visit www.stonewaterhomes-yorkshire.co.ukTo find other shared ownership schemes visit www.helptobuy.gov.uk/equity-loan/find-helptobuy-agent/ You can also find them on property portals.

Help to Buy: Shared Ownership: The Rules

You could buy a home through Help to Buy: Shared Ownership in England if your household earns £80,000 a year or less outside London, or if your household earns £90,000 a year or less in London. You can also take advantage of it if you are a first-time buyer, you used to own a home but can’t afford to buy one now or you are an existing shared owner looking to move.You can buy a newly-built home or an existing one through resale programmes from housing associations. You’ll need to take out a mortgage to pay for your share of the home’s purchase price, or fund this through your savings.You can get help from another home ownership scheme called Older People’s Shared Ownership if you are aged 55 or over. It works in the same way as the general shared ownership scheme but you can only buy up to 75 per cent of your home. Once you own 75 per cent you won’t have to pay rent on the remaining share.