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Staircasing – increase the stake in your home at a time that suits you

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Corner Staircasing – increase the stake in your home at a time that suits you

19 September 2018

Staircasing is one of the great advantages of buying a shared ownership property (where you buy a share of your property and pay rent on the remainder).

Kevin Dunleavy, Head of Homeowner Services for The Guinness Partnership, goes through the process step by step:

There are real benefits to staircasing.

It’s flexible in that you can buy a greater share at a time that suits you – you can staircase at any time. You might be in a better position financially because your children are older and you have stopped paying hefty nursery fees or because you have had a promotion at work.

Once you have bought extra shares in your property, your rent will go down in proportion to the share you have bought. If you increase your share to 100%, you will stop paying rent. (However, if applicable, you will still have to pay the service charge on your property.)

There are five simple steps to buying more shares of your shared ownership home:

Firstly, you need will need to arrange a valuation on your home by a Royal Institute of Charter Surveyors (RICS) surveyor. You may then need to arrange an increase in your mortgage.

Choose your own surveyor from the national register: www.ricsfirms.com

Secondly, it is worth speaking to an independent financial advisor before starting the process to see how much money you will be able to borrow. Speak to them or your current lender when deciding on the size of share that you can afford.

You can find more information to help you choose a mortgage on the Guinness website: www.guinnesshomes.co.uk/buying-from-us/choosing-a-mortgage

Thirdly, choose your solicitor. You will need to use a solicitor when buying an extra share in your home. You may prefer to use the solicitor who dealt with your original purchase.

Fourthly, you may need a copy of your lease to forward onto your solicitors. You should have a copy of your lease from when you purchased your home. However, you may also be able to get a copy from your solicitor or from your mortgage lender.

Finally, after completing steps 1 to 4, most housing associations will then expect you to complete their own application form.

 

What are the costs?

  • You are likely to have to pay a staircasing administration fee to your housing association.
  • Your valuer’s fee (normally around £250+)
  • Mortgage arrangement fees to your lender, if this applies
  • Your lender’s valuation fee, if this applies
  • Your legal fees
  • The cost of the extra share
  • If you did not pay stamp duty on the full value of your home, you may need to pay extra stamp duty. Your solicitor will be able to advise on this.

What can I staircase up to? Is it always 100% of my property

Your lease will include information on staircasing restrictions, if there are any.

What is the smallest amount that I can staircase?

The extra shares come in certain sized ‘chunks’ set out in your lease. Generally, the minimum additional amount that you can buy is 10%.