lifestyle

‘Staircasing helped me buy my shared ownership home outright’


Hesham Elnagar started off with a 60% share of his home in 2014 and later bought the rest (Picture: Matt Reading/Building Relations)

When Hesham Elnagar bought a 60% share of a property seven years ago, like many of those using shared ownership, he had always aimed to eventually own it outright.

Research from So Resi and Cambridge University found that between 2-3% of shared owners staircase to full ownership each year – and this year Hesham, a dental hygienist, is delighted to be one of them.

After renting locally for six years, in 2014 he purchased 60% of a two-bed apartment with a full market value of £160,000 at SO Resi’s Shillibeer Court development in Edmonton, with the eventual goal of purchasing the remaining share.

‘I wanted to get onto the property ladder, but with a single income it would have been impossible to buy a similarly sized property on the open market as house prices are quite high in Edmonton,’ he explains.

‘Shared ownership seemed like a logical option as it meant I could become a homeowner at an affordable price.

‘I always knew that I wanted to increase my share and after moving in I started saving up, putting aside any extra money each month.’

Hesham bought a similar flat to this one, in nearby SO Resi Totteridge (Picture: Simon Harvey)

Prior to staircasing, Hesham’s apartment was valued at £245,000 and he paid £98,000 for the 40% share.

‘Owning 100% of my home feels like a really big achievement and I am proud that I managed to do this thanks to the flexibility of shared ownership,’ he says.

‘The value has also increased as Edmonton and the surrounding areas are becoming more popular, so I know I have made a good investment by buying early.

‘Purchasing through shared ownership and then staircasing last year was actually very straightforward. It has allowed me to become a homeowner in an area that I love, close to friends and family, which otherwise wouldn’t have been possible.’

How does staircasing work?

Shared ownership can be a lifeline for potential purchasers who are eager to climb onto the property ladder but can’t afford a mortgage on 100% of a home.

The scheme, open to households with a maximum income of £90,000 in London and £80,000 everywhere else in England, enables them to buy a minimum initial share of 10% of its value (recently reduced from 25%) repaid via a mortgage, and pay rent to a housing association on the remainder.

Deposits are low as they’re only needed for the stake purchased, and all shared owners have the opportunity to staircase – buy more shares – if they want and can afford to.

The smallest extra share you can currently purchase is 10%, and you’re liable for valuation and legal costs, but under the government’s new shared ownership model, staircasing in increments as small as one per cent will be allowed and fees will be far less.

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