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Alexander Studhalter discusses why people are interested in shared ownership
This shared ownership model allows first-time purchasers to own an amount of real property. Alexander Studhalter is a businessman who thinks that sharing ownership is an alternative. Alexander Studhalter explains why.

First, what is shared ownership?

Shared ownership is an alternative homeownership scheme. It permits first-time home buyers as well as people who do not have homes to share in the new constructions and resales.

Investors are able to purchase a part of a house. This is called part-buy, or part-rent. It's typically between 25% and 75%. If you choose to purchase 10% shares under the Shared ownership model, you are able to raise the amount.

In addition to any ground rent or service charge that are due, the rest of the rent from buyers will be collected from housing associations. A mortgage is not required to purchase a property. Thus the deposit for a home is usually lower than that for buying a house.

Alexander Studhalter discusses the reasons people might consider the possibility of sharing ownership.

Housing for those who are unable to afford to buy a home is available by sharing ownership. There are many reasons why the cost of sharing ownership can be cheaper than other housing options:

The rent is calculated at 2.75 percent of the value of the property, which is less than the market rate.
Begin with 25% under the current scheme or 10% under the new Shared Ownership.
The share's value is the deposit you make, and not the total property market value.
SDLT (or 'stamp duty') can be delayed until the 80% property is held by you.
Alexander Studhalter explains the different types of shared ownership are.


Joint Tenancy Each tenant is required to own an equal portion of the property through one sale document. The right of survivorship forms the foundation for joint ownership. The property passes to the surviving tenant upon the death of one coowner.

Legally, however, ownership of property is considered tenancy by common. This is unless the property's documents state that the property is jointly rented.

Sita and Geeta might have bought a house together. In this case they specifically made mention of the joint lease. If one of the co-owners dies, her share will thoroughly pass on to the surviving tenant.

TIC: Joint ownership arrangement in which ownership percentages are equal (or not equal) under the tenancy. Sarah could own 40% of the property, and Bob might hold 60%.

The person named on the title is accountable in all respects. Sarah is able to access 40 percent of the property, however she is not able to access 40 percent..

Each owner has the legal right to use and occupy the whole property. The ownership of financial assets for property is determined using the percent of interest.

It is the responsibility of the tenant to dispose of or decumber the property at any time. This type of title may be entered at any time--even years after the other owners have entered into an agreement.

You can transfer ownership to other people In the event of death, ownership is transferred to the owner's heirs unreservedly.

Limited Liability Company (LLC): Limited liability companies (LLCs) are business structures in the U.S. that protect their owners from personal responsibility for their debts. A limited liability company has the same characteristics as sole proprietorship or partnership.

While LLCs provide limited liability benefits similar to corporations, they do not offer tax flow-through for members, like partnerships.

What are the negatives of the sharing of ownership?

Alexander Studhalter Not all lenders provide shared ownership mortgages. However, the majority of lenders offer shared ownership mortgages.
You are accountable for the entire amount of ground rent and service charges on your property.
Stamp Duty must be paid on any share that exceeds or equals to 80% of the property's actual value.
All leasehold properties will remain. Some homes are eligible to become freehold if they have reached 100%. The issue must be discussed with the housing company.
Leasehold properties may be offered through Shared ownership. Leasehold ownership gives you the option to live in the house for a longer period of time (usually 99 years or 125). When the lease term ends annually, you may buy or sell the property if you'd like.
What are the benefits of sharing ownership?

Alexander Studhalter As an owner-occupier shared ownership can provide stability over time and freedom, without being stretched too much.
The cost of deposits is usually less than buying from an open market.
If your income level isn't that high, Shared Ownership makes it easier to get mortgages.
Alexander Studhalter The monthly payments are generally lower than for an outright mortgage. Monthly rent payments for private rental are generally lower than those of a mortgage.
Staircasing can allow you to purchase more shares of your home in the future. A variety of staircases are available 100%, which means that the buyer is only responsible for the mortgage, ground rent, and service charges.
You can sell your shares at anytime.
It is not always necessary to pay Stamp Tax land tax on the first purchase.
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You can get tenure security, unlike private renting.
Rent and mortgage installments throughout the term of the lease, which is typically 99 or the length of 125 years.
The leaseholder is able to negotiate an extension through their housing provider after the lease expires. Alexander Studhalter suggests that you select a solicitor or surveyor who is experienced in this area.
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