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Alexander Studhalter: Why people are interested in sharing ownership
First-time buyers are able to own an element of real estate by using the model of shared ownership. Alexander Studhalter believes that everyone should consider sharing ownership. In this piece, Alexander Studhalter will further discuss the reasons why this is the case.

What is shared ownership?

One alternative option to homeownership is to share ownership. It permits first-time home buyers and people who do not have houses to be part of the new constructions and selling.

Investors can buy shares of a house, also known as part-buy or part-rent, generally between 25 and 75 percent. You can purchase 10 percent of the shares first when you choose the Shared Ownership option.

In addition to ground rent and any service charges as well, housing associations also collect a rent below the market value from buyers. The deposit will typically be lower than when purchasing a home for sale because there is no mortgage requirement.

Alexander Studhalter discusses the reasons people might consider taking ownership of their property in a joint venture.

A housing option that is for those who are unable to have the money to buy a home or Shared Ownership. Because of many factors, shares are typically cheaper than other housing alternatives.

The rent is paid at 2.75 percent of the property's worth, which is lower than the market rate.
You may choose to begin with a 25% share in the existing scheme of Shared Ownership or 10 percent of the new scheme.
The deposit amount will be 5-10 percent of the price of the share, not the total market value of the property.
SDLT, sometimes referred to as stamp duties, may generally be deferred up to the 80% limit of your property.
Alexander Studhalter describes what the different kinds of shared ownership are


Joint TenancyAll tenants have to simultaneously be granted an equal interest in the property by way of a sale deed. Joint ownership is built on the right to survive. The property is passed to the surviving tenant after the death of one of the co-owners.

Legally however, ownership of the property is considered to be tenancy-in-common. That is unless you mention in the property documentation that the property is held as joint tenants.

As an example, Sita and Geeta bought an apartment together, clearly informing the tenant of the joint tenancy the property that they co-own. If one of co-owners is not able to live the property, their share will be passed on to the tenant who has survived.

Alexander Studhalter TCI: Joint ownership arrangement in which ownership percentages are equal (or different) under tenancy. https://www.wsj.com/market-data/quotes/CH/XSWX/HLEE/company-people/executive-profile/187288244 Sarah could own 40%, Bob could have 60 percent.

The named person on the title is accountable for the entire property. That means Sarah does not have to be restricted to having access to only 40 percent of the property or only 40 percent of the time.

Each owner has the right to use and live in the whole property. The interest percentage determines the financial status of the real estate.

The tenant is accountable to dispose of or declutter their property at any time. The type of title may be filed at any time even after the owner has signed an agreement.

The owner is able to make a will to a different party; in the event that the owner dies, the ownership will pass to his heirs undivided.

Limited Liability Corporation (LLC) Limited liability corporations (LLCs) are U.S. corporate structures that protect their owners against personal liability for any debts. A limited-liability company shares many features with sole proprietorships and partnership.

LLCs enjoy the same limited liability benefits as corporations but don't offer members tax flow-through like partnerships.

What's the downside of owning shares?

The lenders do not offer the shared ownership type of mortgage. However, the majority will.
The property owner is responsible for 100% of the ground rent and service costs for your property.
Stamp Duty is payable if your share exceeds or equals 80percent of the property's value.
All properties are leasehold. Some properties can be granted freehold by means of a staircase up to 100%. However, this must be negotiated with the relevant housing provider.
Leasehold properties are offered under Shared Ownership. Leasehold ownership allows the possibility of living in the property for a longer time (usually 99 years or the equivalent of 125). The term of your lease is reduced each year, and you can choose to rent or purchase the house.
What are the benefits shared ownership offer?

Shared ownership lets you be an owner-occupier and provides stability for the long-term, without being stretched too thin.
The cost of deposits is generally lower than buying on an open market.
Even if your income is low, Shared Ownership allows you to obtain mortgages.
The monthly payment will usually be lower than if the mortgage was paid off. Alexander Studhalter The monthly payments for rental properties are generally lower than those for mortgage.
Staircasing allows you to purchase more of your home in the long-term. Alexander Studhalter There are many staircases that can be used 100%, which means the buyer only pays their mortgage, ground rent and any service charges.
Your shares are available for sale at anytime.
Alexander Studhalter It's not required to pay Land Tax when purchasing a home for the first time.
Alexander Studhalter's suggestion

Tenure security is a possibility as opposed to private rental.
You must pay rent and mortgage repayments for the duration of your lease, which typically is 99 or 125 years.
After the expiration of the lease, the leaseholder is able to negotiate an extension with the housing company. Alexander Studhalter suggests that you choose a surveyor or solicitor who is experienced in this area. https://find-and-update.company-information.service.gov.uk/officers/5n7KupDWtrdy3AMrkAMYx7gLiDE/appointments
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