Renting? Shared Ownership?

I agree with this and I had been offered the chance to enter into a buy-to-let scheme for my council flat where I’d lived for 22 years, but I think that renting is the lesser of two evils 

nope.... im dead against renting... but i think shared ownership is worse, i think its a scam.

you still pay rent.... but also pay mortgage... and service charge... and ground rent.... and if you fail any payments the company kicks you out and reclaims your half and then does the same thing to others and you lose everything... they can do this too by unfairly raising any of the rent, service charge, ground rent, as much as they want to force you to not be able to pay... thing is you then get stuck with the mortgage still even after it.

id be very wary about this as i think its a scam.

also the promise you can buy the other share percent over time but it goes up based on property price... they will just say the property is valued higher than it is and lie and make it so its way too expensive to buy the next incremements.

andi said:

Is it better than just renting?

I used to work for a company that built and sold these as part of its property portfolio and the whole model is designed to take as much money from you as possible.

If the property rises in value, you have to share any profit with them when you sell.

If the property drops in value, you have to take all the loss when you sell.

Management fees are a way they take a lot more from you than they spend on delivering the services that these fees are for.

Appeal for shared ownership is really only there when the market is in a very overvalued state so if times get difficult it becomes incredibly hard to sell it.

Do some research online - that can be ok in specific circumstances but I suspect it is not a good deal for you to consider just to "get on the ladder" as you will find it near impossible to move to a different rung.

I believe it better to wait that extra year, build up your deposit that bit more and maybe buy in conjunction with friends with a clear contract to work from if you have to get out on your own.

I think that would depend on your circumstances, you would probably still need at least 5-10k in savings to cover the mortgage deposit and fees for a shared ownership property which is completely out of reach for a lot of people. It’s also a good idea to have extra savings on top of the mortgage deposit & legal fees to cover emergency repairs etc. The exact prices will depend on the property value, the percentage you are buying and how much deposit you are paying but when you add the shared ownership mortgage, rent and service charge together it may not be much less than renting a similar property. There are some calculators online if you know the numbers you’re working with, I think ShareToBuy has a good one

Is it better than just renting? I can’t afford a mortgage outright yet and I guess renting in the long run would end up being more expensive?

Shared ownership is where you own a percentage of the house which is paid by mortgage and also pay rent on the other part that you don’t own. You will still need to save a deposit and pay legal fees but the deposit will be smaller than buying the whole house. You will also have the option to buy a larger share of the house in the future and pay less rent. I have heard that they can be very difficult to sell though and a flat will also be subject to extra maintenance fees. My brother is using an inheritance to buy a large share of a property outright then pay cheap rent, that’s probably the best way to do it