What are my options after I purchase a Shared Ownership home?

L&Q’s Shared Ownership scheme gives you plenty of options. As your circumstances change, what was right for you when you first bought your home might no longer suit you. Shared Ownership gives you enough options to make the right decisions in the future.

‘I’d like to buy a bigger share of my home’

You may only be able to afford to buy a 25% share of your home when you first move in. Over time, your financial position may change so that you can buy 50%, 75% or even all of it. This process of buying larger shares in your home is known as staircasing.

We’ll help you buy a larger share of your home whenever you choose to do so.

Yes, you can staircase all the way up to owning 100% of your home. You can staircase three times, buying a minimum additional share (typically 10%) each time. Your lease will explain the process of staircasing in more detail, or speak to us for further advice.

Each time you staircase, you have to get your property valued. You’ll need to pay the costs of this valuation. The typical cost of a property valuation is between £220-£350 (March 2017). You will also be required to pay an administration fee. In March 2017, the cost of this fee was £215 including VAT. Costs are subject to change.

You will also be responsible for paying your legal costs and you may also have to pay fees to your mortgage lender. You may also be liable for additional Stamp Duty costs when you staircase.

Yes, under the terms of your lease you are required to tell the valuer the value of your home. This is because there are public funds invested in your home and market values can change. The new valuation of your home will determine the cost of buying an extra share in it.

The value of the property could increase or decrease based on housing market conditions, so you may find your home is valued at more or less than the original price you first paid for it.

Each time you get your home valued, the figure you’re given remains valid for three months. If you disagree with the valuation you’re given, there’s a process in place for you to query it.

You are required to inform us of any home improvements you make to your home. This should be done via your surveyor instruction request. We also require supporting evidence of all improvements, this will be given to the surveyor to confirm the added value of the improvements. Please remember that the cost of improving your home does not equal the amount it adds to the valuation (e.g. spending £5,000 on a new kitchen may not necessarily add £5,000 to the valuation). The surveyor will confirm the added value and explain this to you when valuing your home. Please note that general decoration / maintenance would not be taken into consideration as a home improvement. Please remember that you must always seek L&Q’s consent before carrying out any home improvements to your property.

If you increase your share to 100%, you will no longer have to pay us rent and you’ll only pay a mortgage on your home. If you partly increase your share (known as interim staircasing), but still own less than 100%, then your rent will reduce.

For example if you staircase from 25% ownership to 50% ownership you’ll pay less rent but a higher mortgage payment each month. You may still have to pay service charges even if you own 100% of the property and the freehold. For more information, please check with our Home Owner Services on 0300 456 6234.

Kim & Amrit staircased to 100%

“Getting on the property ladder in London when you are 26 – it’s an achievement, but then by 29 actually owning the full property outright did feel like a huge achievement.”

What happens if I need to sell?

If you decide to sell your L&Q home, the re-sales team will help you find a buyer. L&Q are given the first opportunity to re-sell your property to another Shared Ownership buyer. This is so that another person has a chance to buy their home under Shared Ownership, just like you did.

You can sell your share in the property regardless of the size of the share you own. When you come to sell up, the value of the home could have gone up or down since you first bought it, depending on housing market conditions.

We’ll try to sell your home in eight weeks. This gives us a chance to offer the property to other first time buyers and to honour our agreement with the local authority. It also helps make sure you’re given an efficient and cost-effective service. We’ll get your home valued and one of our team will visit your home to take professional photos for the sale. We’ll advertise your home online and send mail outs to people who are already on our waiting list for a home. If necessary we will also place adverts in local newspapers.

If we find a buyer for your home within those eight weeks, you’ll be charged an administration fee. This fee is 1.25% of the home’s full market value, plus VAT. This is a competitive fee compared to many estate agents.

If there’s no buyer after eight weeks, we’ll waive our right to sell the property ourselves and you have the option to sell it through an estate agent after that point. You can either sell the whole property for the full market value, or you can just sell your share. If you find a buyer who wants to buy the share, you have to sell at the current market value stated on your up-to-date valuation report – you won’t be able to take offers that are different from the valuation amount.

Please note that if L&Q don’t find a buyer for your share, you’ll be responsible for covering our solicitors’ costs as we’ll be waiving our retail admin fee.

If you decide to sell the property outright, you can accept an offer higher than the valuation amount. If this happens, you’ll need to pay us our share based on the sale price you accept from your buyer. You’ll also be responsible for paying your estate agent fees. You would not be able to accept an offer that is lower than the valuation amount unless you’re prepared to take the shortfall.

Yes, under the terms of your lease we’ll need to know the value of your home when you come to sell it. This is because there are public funds invested in your home.

The value of the property could increase or decrease based on housing market conditions, so you may find your home is valued at more or less than the original price you first paid for it.

Any significant improvements you’ve made to your home will be included in the full market value. From this, we’ll calculate the value of your share.

Your valuation report will only be valid for three months. If it takes longer than three months to sell your property, then you’ll need to get what’s known as a desktop valuation. This is a professional adjustment of the original valuation, based on market conditions. It’s your responsibility to make sure you have an up-to-date valuation during the sale process.

If L&Q find a buyer for your home, you’ll be charged an administration fee. This fee is 1.25% of the full market value of the property, plus VAT. As a seller, you are also obligated to provide prospective purchasers with an Energy Performance Certificate and you’re responsible for the costs of obtaining this. Once you have found a buyer, you will need to cover the cost of any solicitor fees.

You can start looking for your next home as soon as you decide to sell. However, to avoid putting yourself under any pressure, it’s best if you avoid making an offer on another home until a buyer has agreed to purchase your Shared Ownership home.

Laura and David sold their 50% share of a Shared Ownership property with L&Q

“When it came to selling our flat we found that L&Q were very helpful, they supported us through the process. It took a lot of pressure off us at a period of time that could have been quite stressful.”

Next Steps

If you think Shared Ownership is the right scheme for you, register interest and check whether you are eligible.

To find out more about Shared Ownership, you can read our step-by-step guide.