EXPERTS
Q I bought a share of my shared ownership home and I wanted to know if it is possible to own my home outright when I have only bought a share? Shabnam Gulati, Bolton A You can indeed, and that process is known as staircasing. The benefits of staircasing mean that you own a higher share in your property, therefore increasing your share in the property market.The increased share also has a direct effect on your rent – the higher the share, the less rent you need to pay to the housing association. To get started, you need to contact your landlord to advise them of your intention to staircase, a financial assessment will then also need to be done so you can discuss how you will fund the purchase, and how much more of a share is affordable for you. Although you may already have an idea of how you want to proceed, it is important that you speak to a specialist shared ownership broker who understands the complexities of staircasing! You will then need to arrange for an updated valuation, to see what the current market value of your property is, and look to instruct a solicitor. Again, we would always advise you use a specialist shared ownership solicitor who has experience in staircasing transactions. As each transaction comes with its own fees (housing association fees, valuation fees, solicitor’s fees etc) it is best to staircase to the highest amount affordable to you each time. How staircasing works
Finally, when considering staircasing, it is important that you take Stamp Duty fees into account.The rules around Stamp Duty for staircasing can get quite complex, however, the current rules are that Stamp Duty is payable only if the transaction makes your total share above 80%. However, no Stamp Duty is payable if the leaseholder has paid Stamp Duty on the full market value at the time of the initial purchase. This is only an option when purchasing the property as a new build, it is therefore important to consider your staircasing options early and, if it is something you are interested in doing, then consider paying Stamp Duty on the full market value when you initially purchase, as you could save yourself a lot more in the future. To find out more about the benefits of staircasing and resale shared ownership, visit owenpaulo.co.uk.
Joel Taylor
Off-plan
Q I am a first time buyer and I have been looking at many different homes. I’ve seen a development that I like but it is being sold “off-plan” – what does that mean, and what should I be aware of? Jack Davies, Basingstoke A Buying off-plan is an exciting proposition – it often means that if you are quick, you can reserve the pick of the crop and get the plot that you want as there is more choice available. Some developers/housing associations do phased or staggered releases, so check this with them. This is common on very large developments and gives the developer the opportunity to test the market and see if the price increases on its next release – therefore, if this is the case, getting in early, at times, may have a financial benefit. Please remember that buying through a housing association has the extra benefit of having to have Royal Institute of Chartered Surveyors (RICS) valuations before release and every three months. They are unable to just price the property or plot as they wish and are led by RICS valuers. You will want to be clear about what you are getting with your reservation – check the specification list carefully. You should
very low and there might be a large increase in the future if this is the case. There will be a predicted move-in date – which gives a strong indication of when you can move in, but this date can change. No developer or housing association wants this! Ask for a long stop date, which is the date in the contract that developers cannot go beyond without a heavy penalty. Finally, good luck! Buying your new home off-plan gives you a great opportunity to move in first and be part of that new community from the beginning.
see a disclaimer that protects you in case there is a stock or supply issue – whereby the developer needs to supply the same or better as a replacement. Ask who the warranty provider is and what the defects period is with the housing association – you should be looking at 12 years’ protection combined, which is standard. Service charges will change every year and when selling off-plan these are generally an estimate – check that there is sufficient in the sinking fund to cover large development items that will need replacing over time. It is not unknown, unfortunately, that service charges can appear artificially
Hellyn Fairbrother
First Time Buyer February/March 2025 95
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