Shared ownership properties are government funded. The Housing Association will sell a percentage of the property to you and own the remaining percentage. You will pay rent to the Housing Association on the share you do not own. In the future, if you wish to, you can purchase more shares of the property from the Housing Association, this is called staircasing. You can purchase New Build shared ownership properties (brand new homes) or resale properties (second hand homes).
Once you have found the property you wish to purchase, you will need to pay your reservation fee to the developer. You then instruct New Homes Law to act on your behalf, to review our fee schedule please click here.
New Homes Law “New Build” Shared Ownership Steps
Step 1
•Receive instruction, identification and monies on account from client
•Await contract papers from the HA solicitor
•Request proof of deposit funds from client
•Apply for all required searches
Step 2
•Prepare client contract report and send to client for review and signing
•Answer any enquiries raised by the client
Step 3
•Where the client is obtaining a mortgage a copy of their mortgage offer must be received at this point.
•Send a copy of the client’s mortgage offer to the HA or HA’s solicitor for approval
•Prepare a mortgage report and send to client with mortgage deed for signing
•Await mortgage approval and return of all client documentation
Step 4
•Once we are in receipt of the mortgage approval from the HA or HA’s solicitor together with all signed documentation from client and their exchange deposit, we will request the client’s authority to exchange contracts either on notice, if handover has not taken place, or with a fixed completion date, if handover has taken place
Step 5
•Once authority has been received from client we will exchange contracts with HA’s solicitor. Client then becomes legally committed to their purchase and failure to complete their purchase could result in the loss of their exchange deposit together with them incurring additional interest bearing charges
Step 6
•Inform client that exchange of contracts has taken place
•Send lease or transfer to client for signing (At this point contact from us will lessen until nearer the completion date, however we remain available to answer any question(s) raised)
•Await notice of completion to arrive from HA or HA’s solicitor if a fixed completion date has not already been set
Step 7
•Once a completion date has been set we will send the client a completion statement confirming the balance of funds required from them to complete
•Request mortgage advance from lender for completion date
•Carryout necessary pre-completion searches, i.e. bankruptcy, K16
Step 8
•Once all funds have been received from the client and their mortgage lender we will send the full completion funds to either the HA directly or the HA’s solicitor
•Once we have received confirmation from HA that the completion funds have been received, legal completion has taken place
•The Client can then collect their keys at a time agreed with the HA
Stamp Duty Land Tax (SDLT)
You must pay Stamp Duty Land Tax (SDLT) if you buy a property or land over a certain price in England and Northern Ireland. The tax is different if the property or land is in Scotland or Wales. Please refer to the government website for guidance on the same, as this is always subject to change: – www.gov.uk/stamp-duty-land-tax
You pay Stamp duty when purchasing a freehold property, a new or existing leasehold, a shared ownership property, a transfer of property in exchange for a payment. If your stamp duty is for nil consideration, a stamp duty return form must still be submitted to the HMRC. If you would like to calculate what your stamp duty will be, please refer to the following: – Stamp Duty Land Tax: Residential property rates – GOV.UK