This is an option sometimes referred to as ‘shared ownership’ or ‘part rent/part buy’ schemes, it gives the client an opportunity to buy anything between a 25 to 75 percent share in a property in conjunction with a Housing Association. In addition to this the buyer then pays a reduced rent on the portion of the house they do not own.
How it works
Potential homes are available through a range of housing associations. In order to buy a share of a property, there may be a need to get a mortgage although the sale of a previous house with sufficient equity can be used towards the purchase of the agreed portion.
Second-hand properties that were originally bought as ‘New Build HomeBuy’ can also be sold from existing owners. For information on this, visit the local HomeBuy Agents webpage.
Options after purchasing a property through New Build HomeBuy
Once a proportion of a property has been purchased, anywhere between 25 and 75 percent, the owner is able to buy additional shares until they own 100 percent of the property. This is known as staircasing, the prices of additional shares are based on the market value of the property at the time the shares are purchased.
Needless to say, as more of the property is owned, the rent is re-evaluated and reduced proportionally.
If an owner of a New Build HomeBuy wishes to sell the property, their share is put on the market for sale by the housing association used at the original purchase. This is to give other people in need of housing the opportunity to reap the benefits of low cost home ownership. In this case the property is resold at its market value at the time of resale.
