Shared Ownership Schemes

[Opara]

Hello, i'm in the process of looking for somewhere to rent as I am returning to university soon.I keep seeing properties for sale whereby you purchase up to 60% for around th 50/60k mark.Now I have around 55k saved up and as I would be saving on rent every year, it offers a much larger return on investment than an ISA.

Now these seem a bit too good to be true to be honest so I am wary, I'm talking to an agent later and was hoping for some advise on what to ask to avoid pitfalls.I was thinking about my obligations if I wanted to sell up or rent it out in the future and also whether there would be a monthly fee in light of me not owning the property outright.

Has anyone here partaken in one of these schemes?

Cheers

[Sarnie]

You have to pay rent on the 40% of the property you don't own.......

[Scootersp]

'Some' (few) of these schemes you don't pay rent but normally that means buying a higher % at the start, but yes most will require you to pay rent on the other portion although this will be low'ish £2-300 per month.

Selling on is ok in the future and most times you can buy other %'s if you wish to stay there and eventually can own it outright.

Sub letting rent wise when you don't own it all is usually against 'the rules' but I believe many do it on the quiet.

[Scootersp]

Search google for "Homes in Hants" even if you are not in that area it will give you a good insight into Shared ownership

[Opara]

Thanks, I spoke to the agent and she said the other 40% would be held by the building owner and stipulated the buyer must:

First time buyer

Earn less than 60k

Have a connection to the area

She then confirmed that when it comes to selling up it would be at 60% market value and renting out isn't allowed.Also she said there was no rent due on the remainder though I forgot to check ground fees.

All in all it seems a good deal, the only drawback I can think of is that when it comes to selling these stipulation reduce the target market making it more difficult.

[Truckosaurus]

Also, although you 'rent' a certain percentage of the property the housing association won't help out financially with any maintenance or repairs to your property. This is especially an issue if you've only bought a small percentage but are saddled with 100% of the upkeep costs.