Types of Home Ownership
From April 2018 the Welsh Government have launched the Rent To Own scheme and Shared Ownership Scheme details can be found on the following link Shared Ownership Wales
Clwyd Alyn has a wide range of ‘leasehold’ stock, all managed by the Leasehold and Sales Team. Each type of tenure is different and the following descriptions may help you when contacting the Team” - Rob Hopkins Leasehold & Sales Manager.
Do It Yourself Shared Ownership: these are properties where the owners originally identified the property and then have asked Clwyd Alyn to acquire a share in that property. DIYSO residents, pay rent to Clwyd Alyn and an insurance premium (for buildings cover only) through a service charge. All DIYSO residents hold long leases which set out the contract between themselves and Clwyd Alyn.
Do It Yourself Home Ownership: these are properties where the owners originally identified the property and Clwyd Alyn agreed to provide a loan to assist in the purchase. No rent or insurance is payable on these properties to Clwyd Alyn. There is no lease in place and Clwyd Alyn’s equity is protected by a loan agreement.
Shared Ownership Properties
These are generally properties which Clwyd Alyn built or acquired. The owners pay a rent on the share not purchased and an insurance premium (for buildings cover only) through a service charge. A lease is also in place which sets out the contract between themselves and Clwyd Alyn.
These are properties purchased with the aid of a Homebuy loan from Clwyd Alyn. These are very similar to DIYHO properties with no rent or insurance premium being payable to Clwyd Alyn.
LSE - Leasehold Schemes for the Elderly
These LSE properties are for sale to retired or elderly persons. They are governed by a lease and as with all apartments Clwyd Alyn provides all scheme services. Usually the schemes allow persons to buy 70% of the value of each apartment with no rent payable on the 30% owned by Clwyd Alyn.
What is Shared Ownership?
Shared Ownership is an alternative to the renting or full ownership of a property.
With Shared Ownership, you buy a ‘share’ of your home (with a mortgage), and pay rent on the remainder. It is particularly suitable for people who have a regular income and wish to buy their own home, but cannot afford to do so through conventional methods. Shared Ownership can be arranged through Clwyd Alyn Housing Association which is a Registered Social Landlord (RSL). RSLs are non-profit-making organisations which provide high-quality, affordable homes for rent and for shared ownership. The aim of Shared Ownership is that the total monthly costs of the rent and mortgage combined should be lower than the cost of the mortgage that would be needed to buy 100% of the same home. This is because Shared Ownership is supported by Government money, which helps to reduce the rent part. ‘Shared Ownership’ does mean that you will have sole right of occupancy.
So, what is a Leasehold Scheme for the Elderly (LSE)?
Leasehold Schemes for the Elderly are purpose-built apartments, specifically designed to meet the needs of older people, and intended to provide the leaseholder with low-cost accommodation and a totally independent life-style. It is recognised that older people, particularly owner-occupiers, sometimes find it difficult to meet the running costs of their existing homes, and to properly maintain both the property and its grounds.
How does it work?
With the Leasehold Scheme for the Elderly the property is sold ‘leasehold’ with the freehold remaining with Clwyd Alyn Housing Association. The lease is for a term of 60 years; it is not assignable and is eventually surrendered to the Association. Leasehold properties are sold for 70% of their current market value. This is possible because the Government provides a Grant of 30% of the total cost to the Association when the property was built. The Lease cannot be assigned except to the leaseholder's surviving spouse, who is living at the premises or a close relative or friend, who has resided at the property for at least 6 months prior to the date of death of the Leaseholder.
Who cannot become a Shared Owner?
People who can afford to buy a home (which meets their needs) on the open market do not qualify for Share Ownership.
Who can become a Shared Owner?
Shared Ownership is open to any local applicant, with a regular income, who can secure a mortgage to buy a share in the property. It is also available to local applicants who have sufficient means to buy a share without a mortgage, but who cannot afford the full costs of outright ownership. This can include first-time buyers, people renting from the private sector, homeowners who need to move due to a relationship change or change of circumstances, or people who live in areas where properties are expensive. d Ownership. Nor do those who cannot afford to meet the costs of the mortgage and rent combined. If you have a County Court Judgement or have a history of rent arrears or bad debts then you are also unlikely to be considered.
Who cannot become a Shared Owner?
People who can afford to buy a home (which meets their needs) on the open market do not qualify for Shared Ownership. Nor do those who cannot afford to meet the costs of the mortgage and rent combined. If you have a County Court Judgement or have a history of rent arrears or bad debts then you are also unlikely to be considered.
Can I buy a bigger share of my home?
A year after you purchased your home you have the opportunity to increase your share of ownership. This is known as ‘Staircasing’. Each time you increase your share you must do so by a minimum of 25%. With Staircasing you could eventually become the outright owner of your home. The share you purchase will cost a percentage of the market value of the property at that time. Each time you increase your share of ownership, your rental payments will be reduced. But, if you increase your share with an increased mortgage then your monthly mortgage repayments will increase also. Therefore, the purchase of extra shares could mean that the combined cost of your rent and mortgage payments will increase, you will need to check this with your lender at the time. Of course, you do not have to increase your share, it is entirely your choice. Shared Ownership is flexible and allows you to choose if and when you want to increase your level of ownership.
What happens when you want to move?
The first step is to inform Clwyd Alyn of this decision. You must also tell your mortgage lender. The ‘Association has the option to nominate a buyer, as it keeps a waiting list of people wanting to become Shared Owners, and can nominate someone to buy your home. If Clwyd Alyn cannot nominate a purchaser or buy back your home as per the Lease then you may sell your home on the open market. You are of course free to use the services of an Estate Agent to do this but all fees charged by the ‘Agent must be met by the Shared Owner. When you have decided you want to move Clwyd Alyn will explain how the sales process works in more detail. It is no more complicated for a Shared Owner than it would be if they owned outright.
Who benefits from any increase in value?
You do. As a Shared Owner, you benefit from any increase in the value of your property, according to the share you own. So, for example, if the value of your home had increased in value by £4,000 and you own 50%, then your share of the increase would be £2,000. But please remember that property prices can fall as well as rise. If this happens then you would have to bear your share of the loss.
The Leaseholder Forum exists to represent all leaseholders and shared owners. The Forum has a real opportunity to have a direct input and can influence the services provided by Clwyd Alyn. The Leaseholder Forum consists of Leaseholders, Shared Owners, The Leasehold and Sales Team Manager and 2 Officers. Amanda Bassett, a Shared Owner, is Chair. Together we review the Leasehold and Sales Team policies and performance. We do this by giving recommendations on proposed policies e.g. The Sub-Letting Policy. We monitor how the Team delivers Services and measure them against the Service Standards we helped establish. Where issues arise, e.g. Repairs and Maintenance on The Satisfaction Survey, we will scrutinise these and make an Action Plan to improve them. We then review these Action Plans, prioritising them and make sure they are acted upon.