Shared ownership property schemes have become an increasingly popular way for first-time buyers to get on the property ladder in London. These schemes allow buyers to purchase a share of a property, typically between 25% and 75%, and pay rent on the remaining share. However, when it comes to valuing a shared ownership property in London, the process can be slightly different than valuing a traditional property. This article will explore how shared ownership property valuation is assessed in London.
Shared Ownership Property Valuation Methodology
The valuation of a shared ownership property is typically based on the percentage share of the property being purchased. For example, if a buyer is purchasing a 50% share of a property, the valuation will be based on 50% of the full market value of the property.
The full market value is the price that the property would sell for on the open market if it was being sold as a whole. The valuation will take into account various factors, such as the location of the property, the condition of the property, and any other relevant factors that could impact the value.
It is important to note that shared ownership properties are valued differently than traditional properties, as they are part-owned and part-rented. The valuation of a shared ownership property will be based on the value of the share being purchased, rather than the full value of the property.
Valuation Process
When valuing a shared ownership property in London, a qualified and experienced professional, such as a chartered surveyor, will typically carry out the valuation. The valuer will consider various factors that could affect the value of the property, such as the location, size, and condition of the property.
The valuer will also consider the current market conditions and any other relevant factors that could impact the value of the property. This could include factors such as local amenities, transport links, and planning restrictions.
Once the valuation has been completed, the buyer and seller can agree on the sale price for the share being purchased. It is important to note that the sale price for the share being purchased must be at least the minimum percentage set by the housing association or local authority.
The buyer will typically need to obtain a mortgage to finance the purchase of the share, and the lender will require a valuation to be carried out to determine the value of the property.
Additional Costs
When purchasing a shared ownership property in London, buyers will typically have to pay additional costs on top of the purchase price. These costs can include:
- Stamp Duty: Buyers will typically have to pay stamp duty on the share being purchased. The amount of stamp duty payable will depend on the purchase price and the percentage share being purchased.
- Legal Fees: Buyers will typically have to pay legal fees to a solicitor or conveyancer to carry out the legal work associated with the purchase.
- Service Charge: Buyers will typically have to pay a service charge to cover the cost of maintaining and managing the shared ownership property.
Conclusion
Valuing a shared ownership property in London can be a slightly different process than valuing a traditional property. The valuation is typically based on the percentage share being purchased, rather than the full market value of the property. The valuation process will take into account various factors, such as the location, size, and condition of the property, as well as current market conditions.
When purchasing a shared ownership property in London, buyers will typically have to pay additional costs on top of the purchase price, including stamp duty, legal fees, and service charges. It is important to factor these costs into the overall budget when considering a shared ownership property purchase.
Overall, shared ownership schemes offer an attractive option for first-time buyers looking to get on the property ladder in London. With the help of a qualified and experienced professional, buyers can ensure that they are paying a fair price for their share
