Are you pondering the prospects of selling a shared ownership property? The process may seem complex, but with the right understanding, it can be a rewarding experience. Shared ownership, also known as part-buy part-rent, is a low-cost homeownership scheme that allows you to purchase a share of a property while paying rent on the remaining share. If you're ready to fully own your home or move on to a new property, selling a shared ownership property is a viable option.
Before we delve into the process, let's clarify the types of shared ownership properties. There are two primary types: Leasehold and Freehold. Understanding the type of your property is crucial as it affects the selling process. Leasehold properties often have a defined-period lease, while Freehold properties give you full ownership and no time limit.
Can You Sell a Shared Ownership Property?
Absolutely, you can sell a shared ownership property. The process, however, is slightly different from selling a full-quarters property. The leaseholder (your initial provider - usually a housing association or a local council) has the right to purchase your share first before you can sell it on the open market. This is known as the 'right of first refusal'.
This clause protects the leaseholder's interest and maintains the supply of affordable housing. It also gives them the chance to acquire the property back if the owner wishes to sell. However, there are scenarios where the leaseholder might choose not to exercise this right, paving the way for you to sell to another buyer.
Tips for Selling a Shared Ownership Property
Before proceeding, it's essential to understand the key aspects of selling a shared ownership property. Here are some practical tips:
- Understand the Right of First Refusal: Familiarize yourself with the terms of your lease. This will help you understand the extent of the right of first refusal and what happens if the leaseholder chooses to exercise it.
- Seek Permission to Sell: Before marketing your property, you must write to the leaseholder, requesting permission to sell. They may grant consent immediately or decide to exercise their right of first refusal.
What Happens Next?
The leaseholder's decision significantly impacts your next course of action. Here's what might happen:
- If they choose to buy your share, you'll proceed to transfer ownership, usually involving a solicitor. You'll be responsible for repaying any Government-funded loan you have, if applicable.
- If they decline, they'll instruct you to find a buyer and inform them of any offers. You'll sell your share at market value, following a valuation by an independent valuer.
Considerations When Selling a Shared Ownership Property
Before putting your shared ownership property up for sale, consider the following:
Fees and Costs
Similar to selling any property, there are fees involved. You might encounter solicitor's fees, estate agent fees, and a potential Government-funded loan repayment fee. Be prepared for these expenses.
Finding a Buyer
Finding a buyer for a shared ownership property might take longer, as some potential buyers might prefer full-independent ownership. However, there's always a market for affordable housing, so patience and persistence are crucial.
Selling a shared ownership property can be a seamless process with the right understanding and preparation. It's an excellent way to progress on your property journey, whether it's to fully own your home or move to a new property. Good luck with your sale!
