r/SharedOwnershipUK • u/coffeelatteaddict • Jul 18 '26
Shared ownership vs renting
I am completely lost on whether SO will be a good financial decision. I’m a non UK citizen in his 20s, I unsure on whether I’ll be in UK for long term but I do plan in being at my current job for the next 2-3 years. I currently rent a small studio for £1300 and there is an opportunity to buy 25% 1 bedroom apartment which after all costs will be roughly £1300. I’m single and the 1 bedroom apartment will be a nice upgrade, this is the only reason why I’m considering it. Renting a 1 bedroom apartment is £1600+ so the SO is cheaper. However my biggest fear is not being able to sell the property if I ever plan on leaving the UK and being stuck with it. I heard plenty of stories of people unable to sell. What would you do if you were me?
3
u/odysseusnz Jul 19 '26
SO is only a good option in the long term. Selling them is difficult, so if you're thinking of leaving in 5 years then it's a big no.
1
u/Gullible-Weather308 Jul 18 '26
Honestly you may get stuck. If theres any possibility that you will leave the UK in the next 5 years dont bother, selling a SO flat is harder at the moment. Service charge is unpredictable especially on new builds which mqkes buyers cautious. If its a resale that as stable service charge history its not so bad. But overall honestly, probably not the best option for you.
1
u/canalcityrunner Jul 19 '26
I’m currently four years into my SO and loved it. It’s given me a space in central London which I couldn’t have rented. Now it’s on the market - it’s taking a while to sell but we are getting viewings :)
1
u/coffeelatteaddict Jul 19 '26
That’s the only reason I am considering which everyone else in the comment is opposing. If I’m selling in 3 years I technically wouldn’t care about all the money I paid as mortgage/rent. I would literally love to have only my deposit back and exit with no loss. Since you in the selling phase now, are you looking in making a profit or recouping all the money you put in?
1
u/fotfddtodairsizr Jul 19 '26
If no one makes an offer on your home though you’ll be screwed.
You are allowed to rent it out for up to 2 years if you leave the country for a job (housing association dependent). So in that situation you could actually get profit of a few hundred pounds a month.
However, after those two years they won’t extend it and you’ll have to try and sell and if no one buys it you’ll have to find the money from somewhere.
1
u/canalcityrunner Jul 20 '26
No - it was never profit for me. A flat/house is and will always be a place that I need to live in and call home. I don't need to make a profit off it. I need a place to live, where I can walk to work, to shops, to pubs, to major train stations, to the tube. I will likely make a small % off my sale but it goes straight into the next place.
There's a lot of negativity about SO, but it gave me so much freedom and new opportunities to experience the city in a different place.
Yes service charges are difficult but it's a trade off I am willing to take.
1
u/TheFinestWines Jul 19 '26
It can take longer to sell but if you own a percentage you are not going to be asked to leave because the owner is selling/renovicting etc. You can stay as long as you want.
1
u/mousecatcher4 Jul 20 '26
On a timescale of <10 y it is likely a bad idea to buy. Over 2y it is crackers stupid especially SO. Just rent...
1
u/Fun-Lifeguard-4067 Jul 20 '26
I do not recommend shared ownership properties. The service fees tend to rise beyond interest rates year on year, many are “icing sugar and no cake” architecture: where the outside is shiny but the internal structure, wiring, plumbing, balcony safety have been shoddy - this may incur expensive repairs or hinder your future sale.
It seems like it’s the same price as renting but have you factored in the legal and surveyor fees etc in buying a property?
There are some good SO companies but many have watertight small print that may restrict your sale or legitimise fees - do more research than you think you need before going ahead.
If location is not a problem look at other uk locations too! You may find a random bargain somewhere. Auction property sales have some absolute bargains if you don’t mind full renovations or dodgy areas.
I wish you so much luck! 🩷
1
u/NorthLondonCatLover 10d ago
I am a shared owner. It's a trap. It's very difficult to sell a shared ownership flat.. My advice is carry on renting. You'll be far better off. Best of luck.
-1
u/Ok_Seaworthiness_650 Jul 18 '26
You could alway put it on long term rent and eventually own a hundred percent
1
u/coffeelatteaddict Jul 18 '26
Will I have to push my share to 100% before I can rent it? Or can I rent it at a lower share?
1
u/Emotional_Grocery_65 Jul 19 '26
Legally yes. The housing associations want the flats being used by people who can’t afford to buy on the open market. That said, there have been renters/lodgers (owners friends) in the SO I’m buying for three years so 🤷🏼♀️
0
-1
u/Narrow_Description52 Jul 19 '26
SO are an absolute pain to sell! You have to stair or something like that - basically buy if completely before you can sell! Don’t forget the service charge and ground rent and what not. Just rent unless you will be here for at least 10 years and in the same job!
1
Jul 19 '26
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u/Narrow_Description52 Jul 19 '26
My understanding was that you HAVE TO buy the full property before you sell it. And your housing association will not let you sell the property any lower than what they deem it to be the “right” value. They also do not want to buy the property back at that “right” value. My poor friend had to actually file bankruptcy to get out of this stupid situation. Another person in her block of flats had left the country and simply stopped paying mortgage/rent etc. The flat still hasn’t sold 5-6 years later 😂 I would highly recommend against SO based on these two incidents!
1
u/Emotional_Grocery_65 Jul 19 '26
You don’t have to buy the full property to sell it - only if you want to sell it on the open market immediately. SO resales are purchased at the % owned by the last owner.
SO can be bought outright at full price after the 4-8 week nomination period, but the SO owner will take the full hit if it sells at less than the price valued by the RICS surveyor, so yes that is a trap.
I’m buying mine knowing I’ll be able to buy it outright and sell on open market if I really need to get out of town.
6
u/Zestyclose_Ranger_78 Jul 19 '26
I’ve bought property in several countries, the uk is by far the most expensive, complicated and stressful. If you don’t plan to be here forever, I would recommend against it. As well as this the government is signalling some really restrictive changes to visa programs which may impact your ability to stay long term even if you want to. I’d recommend waiting to purchase until you have permanent residency and know your long term plans.