How to sell shared ownership property
Selling My Shared Ownership Flat - Process and Costs
0:00 / 0:00
Timecodes:
hi guys so whilst this isn't my normal
finance content i did make a video a
long time ago about um my shared
ownership property and the pros and cons
and things like that and
i've since sold my property and i think
i get a lot of questions around the
process and what that was like and
certain things that i thought i would
just make a follow-up video um just
about the sales process and and stuff
like that i know that this video
probably won't appeal to my usual
audience but i'm just hoping that
those few people that have asked for
this and maybe some new people from
search
it will benefit you in some way so i'm
going to kick off but if there is
anything that i don't cover here it was
a long time ago i sold my property in
september last year so if there's
anything i forgot to mention or if you
have any other questions just pop them
in the comments below and if i'm able to
answer them then i will so the first
step was essentially to get in touch
with my housing association and let them
know that i was interested in selling my
property and the reason for that is
because essentially in most instances it
will be within your contract that the
housing association gets eight weeks or
so to try and sell your property on
themselves so you need to give them the
option to do that now for me i was lucky
enough that my housing association said
no thanks we're waiving our right to do
that so you can just go ahead and market
your property in a normal way now
there's pros and cons of both and mainly
the things to consider are timings and
cost so of course if you sell within
eight weeks that's great it's a quick
sale etc but
generally you have to pay the housing
association a
normal type of estate agent fee
so i think it was about one percent for
mine so that was going to be a lot of
money considering the full value of the
property so and yes it is the full value
of the property rather than the share
that you own i do think this is
something a lot of people don't realize
is that when you're selling and
generally when you own the property even
if it's shared ownership the costs that
you pay are as if you own 100 so it was
going to be
one percent of the
k or so that my property was worth the
other thing to note is that if you do
sell your percentage you have to sell at
the rix valuation and this is
essentially the next step that you have
to take is to get a rick's valuation so
whereas with a normal property when you
own it you can essentially sell it for
whatever you like and you don't need a
rick's valuation usually it will be
enough just to get a few estate agents
in and they'll give you a ballpark of
what similar properties have sold for
with shared ownership regardless of
whether you're selling 100
or 40 or whatever it is you have to pay
for the rix valuation which is usually a
few hundred pounds now the main reason
that you need evaluation is that
essentially
because the housing association owns the
remainder of the property they will take
their fair share so whatever the fair
market value is if they own for example
in my case i had 40 and they had 60 they
would take the fair market value of 60
and then anything above or beyond that
is for you to cover so if you sell for
less then you have to cover the loss
in full and if you sell for more then
all of the profit was for you
essentially so
i thankfully sold for more so all the
profit was for me now the other reason
that you have to have a rix valuation is
that if you are selling just on shared
ownership so for example
if i owned 40 and i was only selling 40
you cannot sell for a different price
than the rix valuation so you can't say
i want to sell 40
but i'm gonna sell it for a bit more so
i can make a profit no you have to sell
for that risk valuation that's not to
say that the rick's valuation can't be
higher so if it goes up or down
obviously that's still then that loss or
increase but it's it's just about if it
comes back at for example exactly the
same valuation but you want to sell for
more you can't do that if it's 40
hopefully that makes sense it feels like
a very long-winded way of saying it now
once you've done your risk valuation and
you're
happy with whether or not you're happy
to sell at that price and you know
whether you're going to market at
your percentage or full market value you
need to find an estate agent so for me
i went with purplebricks and the reason
i did that is because the difference in
price was astronomical so with
purplebricks i paid
1500 up front
so obviously the downside is that you
have to pay this upfront whereas with
estate agents you pay once you sell but
it's essentially a lifetime fee so
whether you sell your property or not
eventually you'll probably sell it so
it's covered and if you decide to take
the property off the market and then put
it back on again it's still covered by
that fee now i worked out that if i sold
through the housing association and paid
one percent it was going to be about
3600
versus that 1500 from purplebricks so i
would have saved or i had saved 2100 on
that and if i sold by a normal estate
agent
the lowest price that i was quoted was
1.5
so
that would have been about 5400 for me
so again that's almost 4 000 pounds
higher than the purple bricks fee and
the main difference with purple bricks
is just that generally you do your own
viewings so you are the one that
arranges the viewings and things like
that but for me that was better because
i didn't really feel comfortable people
coming to view my flat when i wasn't
there anyway
so i was going to be there regardless
and i'd been screwed over by estate
agents before so i didn't really want to
get into the whole like
them lying to the buyers or anything
like that i just wanted to be in charge
of all of that so i was really really
happy with with that experience and they
took amazing pictures of my flat so yeah
once you have that you have to forward
their details to your housing
association and then you wait now i
instructed my solicitor before i found a
buyer and the main reason for that was
because
i knew what solicitor was going to go
with and i wanted to get ahead of the
game so i knew there was going to be a
lot of paperwork and oh my god the
paperwork
like i think selling a normal house or
flat is bad enough but
with shared ownership it's even worse so
just be prepared for like
tons of paperwork and because i
instructed my solicitors beforehand i
could fill out a lot of the paperwork
ahead of time so when i eventually found
a buyer which i actually found really
quickly a lot of the paperwork was ready
and whilst obviously you then still had
to wait for the buyer's paperwork and
their solicitors pretty much most things
from my end were sorted a question that
i get asked a lot as well is about
how is it that when you own 40 you can
still sell 100 and stuff like that and
essentially the way it works is you buy
the remainder of the property on the day
that you complete so it's called a
simultaneous staircasing so
on the same day you buy 100 so you
staircase up and then the buyer buys it
off you and it's mostly a paper exercise
it's not like you're having to
incur a lot of extra costs generally
although this is something i think that
you need to make sure you get a
solicitor that knows about shared
ownership and is an expert in shared
ownership because um i've seen different
instances of like
not paying for extra stamp duty on
staircasing simultaneously and then
paying it and the difference was someone
who was an expert in it and who wasn't
so i would say that if you are planning
on selling a shared ownership property
that you do get a solicitor that is an
expert in shared ownership so other than
that it basically gets treated like a
normal sale so those are the only things
i think that are
worth mentioning and i also get asked
about my selling costs a lot so i just
thought i'd let you know um i paid
obviously the 1500 for bricks i paid
250-ish for the surveyor for the rix
valuation i paid
375 pound for a managing agent managing
pack 120 pound for a deed of covenant
and
1504 pounds for solicitor fees now i got
quite lucky because there were a lot of
other fees that were listed that were
potential fees that we could have
incurred that i know other people with
shared ownership properties have
incurred so for example if a deed of
variation was required it was an extra
750 pounds and stuff like that so i
would say it's worth contacting the
housing association and asking for a
list of potential costs that you could
incur
and just being prepared to cover them
all
and being pleasantly surprised when it
doesn't all happen but not being
completely thrown off if it does now
once that is all done and you've
exchanged all the paperwork the housing
association essentially just gives a
final statement like a settlement with
all your outstanding rent and service
charges and whatever else
and that all gets paid off as part of
the settlement so the final statement
that you get will essentially say this
is what the buyers have paid these are
the extra things they're paying for so
for example for me they paid a bit extra
for some of my furniture and then all
the reductions so for example here was
your outstanding service charges to this
date etc etc
um and therefore well and their fees etc
and therefore this is the final amount
that's going to go into your bank
account the final thing i think i wanted
to mention was that the rix valuation
has to always be up to date and for me i
almost had to pay extra for another
valuation
which could have changed the price which
would have meant that i would have had
to go back to my buyers and say prices
increased for example because of the
amount of time that it took to go
through everything and
it wasn't even that long i don't think
i'm pretty sure
i got the valuation in like march or
april and then it was going to expire at
the start of september so
i managed to just get it through like a
few days before it was going to expire
um there are ways to extend it i think
if you're late on in the process
but
it's just a lot of hassle um so just
make sure you're on top of that and you
know how long your ex valuation is valid
for i think that's it i think that's all
i wanted to mention um like i said if
you have any other questions that i've
not covered or thought of just pop them
in the comments below and yeah hopefully
that was useful and thank you for
watching
bye
