Guide to 'Resale' Shared Ownership
What is a Shared Ownership Resale property?
Resale properties are homes that a current owner bought through Shared Ownership and now wishes to sell on. The principle is the same as buying a new build through Shared Ownership but you must purchase at least the share that the seller currently owns.
The benefits of buying a Resale property
Within new build developments, Shared Ownership is usually only available to people living or working in the borough where they are looking to buy. But that's not normally the case with Resale properties, which makes moving to a new area simpler.
We often sell our new build properties ‘off-plan’, i.e. before they are finished. With Resales you can view the property you are looking to buy a share in and moving in to a development where the neighbours are already moved in and settled has its draws.
It’s nice to know someone’s there if you need to borrow some sugar.
Frequently Asked Questions about Resale Shared Ownership Homes
Who can buy a Resale property?
Anyone who cannot afford to buy a suitable home on the open market may apply as long as their total household income is no more than £90,000 per annum. A lower income threshold (£80,000) is applicable for developments outside London boroughs.
If you live outside one of the London boroughs, you must apply to the local Homebuy Agent, who keeps the central register of applicants who wish to be considered for government funded affordable housing. We will only offer part buy, part rent properties when we have received an approved registration from the Homebuy Agent.
Why buy through a Shared Ownership scheme?
If you buy through Shared Ownership:
- You will own part of the value of your home, rather than paying rent with no return.
- Your monthly mortgage and rent can work out cheaper than buying outright, and often not much more than renting.
- You can buy more shares (Staircasing) or sell your share and move if you want to in the future.
- You buy the share the current owner owns or more if we feel you can afford it.
When I buy a resale property, what am I buying?
A Resale property is a Shared Ownership property that the current owner bought new from us or as a Resale. The property is a part buy/part rent scheme. The property would have been partly funded by the government and aims to help first-time buyers. Shared Ownership properties are designed as a stepping stone to completely owning your own home, allowing you to buy as much as you can afford when you can afford it.
Buying a resale property makes you an owner-occupier, not a part tenant. You are buying at least the current owner’s share on the existing lease. Your lease is a legal document that proves you own part of your home. Your lease sets out certain conditions such as:
- How often your rent and service charge is reviewed
- The conditions of the lease which must be adhered to
- The conditions regarding selling or buying further shares
- What you should expect from us and
- Your rights and responsibilities as owner-occupier
As you own a lease on your property you will be a ‘leaseholder’ and we’ll be what is known as the ‘landlord’. You will have the same rights and responsibilities as a full owner-occupier.
If you decide to buy the remaining share of your home, you will own your home outright. If you own a house, your solicitor will arrange for you to get the freehold (in most circumstances) like any other house owner. If you own an apartment, you’ll remain a leaseholder like any other apartment owner. This is because if your home is in a block of apartments, your lease sets out responsibilities for use and maintenance to all shared areas.
You will still be responsible for the ground rent and service charge which will include buildings insurance.
You will require a solicitor when buying a property to deal with the legal work associated with your mortgage and home.
Selling your home if you live in a block of flats
Some leaseholders may experience issues securing mortgages for homes which are in blocks of flats as a result of changes in building safety advice. Please seek advice directly from your lender or mortgage broker before applying so that you do not incur any unnecessary valuation or solicitors' costs.