In this guide, we will explore Shared Ownership staircasing which is the process for existing owners to buy more shares in a Shared Ownership property.
From addressing frequently asked questions to providing a detailed roadmap for navigating staircasing, we’re here to make your path towards increased home ownership clearer and more manageable.
Guinness Homes is proud to provide award-winning Shared Ownership and private sale homes in areas you want to live.
What is Shared Ownership Staircasing?
Staircasing lets you buy more of your home over time under the Shared Ownership scheme.
The major benefit?
- As you buy more of your home, you pay less rent. Plus, as house prices go up, so does the value of what you own.
- Every time you buy more shares (staircase), your stake in the property could grow.
Before deciding, it’s wise to get advice from a legal professional who understands Shared Ownership well.
How Do I Start Staircasing?
Staircasing means buying extra shares in your shared ownership home. After getting your first share, you can buy more, usually 10% at a time but some schemes might be lower. The price for these shares depends on how much your home is worth now – something an independent surveyor will figure out.
This gives you flexibility: Buy more when you can afford it and aim for full ownership in the future. Owning more means paying less rent to the housing association.
Though starting may seem tough if it’s new to you, breaking it down into steps helps:
- Check Your Budget – Know what buying extra shares costs, including legal fees and valuation charges.
- Get Your Home Valued – An independent expert must set a current price for your home.
- Tell Your Housing Association – With the valuation done, let them know about wanting to staircase; they’ll help with paperwork and advice.
- Seek Legal Help – It’s important not just because it saves trouble but also time.
- Arrange Financing – Talk about staircasing with whoever gave you a mortgage or look into other finance options like loans or savings.
- Buy More Shares – Once money matters are sorted, increase how much of your home belongs to you.
Considerations Before You Buy More Shares
There are several factors you need to consider before deciding to buy more shares:
Before you decide to buy more shares in your home, there are a few important things to think about:
Can You Afford It?
Ask yourself if you can handle the ongoing costs like maintenance, insurance, and mortgage payments.
To start staircasing, first look at your finances. This includes how much of your home you already own (your equity), which could help pay for more shares. Also consider your income, spending, and any other money obligations to see if you can afford it.
How Long is Your Valuation Good For?
Remember that the valuation of your home only lasts three months. Try to finish buying within this time.
Are There Any Rules on Buying More Shares?
Your lease might have rules on how often or how much you can buy at once.
Staircasing has its upsides but also challenges such as costs – think valuation fees and legal charges – and possibly higher mortgage payments later on. To manage these challenges:
- Make sure you understand all the costs involved.
- Plan your budget carefully.
- Staircasing can take time. Having all needed documents ready can make it quicker.
Potential Staircasing Restrictions and Limitations
Before you decide to buy more shares in your home, keep these points in mind:
- Restrictions: Your lease might limit how often and how much you can buy at once.
- Extra Costs: Some housing associations charge fees for the paperwork.
- Selling Limits: In certain rural areas, who you can sell to may be restricted because of a ‘local connection criterion‘.
- Lease Terms: Always check your lease for any rules about buying more shares or other conditions.
Getting advice from a legal professional is wise. They can help make sense of your lease and guide you through staircasing.
Step-by-step guide to help with the staircasing process
A Simple Guide to Staircasing
Staircasing is your path to owning more of your home, and eventually, the whole property. Here’s how you can navigate this process with help from your housing provider.
- Talk to Your Housing Provider: Start by getting in touch with them (this could be a housing association or developer). They’ll explain their specific rules and what you need to do next.
- Check If You’re Eligible: Make sure you fit the criteria set by your provider. This might include being up-to-date on payments, earning over a certain amount, or having lived in the property for a certain time.
- Get Your Home Valued: To buy more shares, find out what your home is currently worth. You’ll need an approved valuer to give you this figure.
- Apply for More Shares: With your valuation ready, fill out an application form from your provider and submit it along with any required documents.
- Sort Out Your Mortgage: If you need extra borrowing to buy these shares, talk to mortgage lenders for an agreement in principle. Look around for the best offer that suits your situation.
- Handle the Legal Side: Once approved, choose a solicitor who knows about Shared Ownership deals well enough they will take care of all legal work involved.
- Complete the Purchase: After finishing all legal steps successfully purchase additional shares! Your housing provider will then update their records; remember there are fees associated with increased ownership which should have been outlined at each step of planning.
Although staircasing might appear daunting at first glance, it is often possible to effectively manage concerns such as unexpected costs or lengthy processes through careful planning and understanding each stage.
