Sharing’s the way to get on the ladder

The Social HomeBuy scheme that allows housing association tenants to buy a share of the properties they\'re renting offers a lifeline to struggling consumers, says Simon White

I’m going to tell you everything you need to know about shared ownership schemes. I realise it isn’t the sexiest of subjects but I’ll try my best.

Being a surveyor, the problem is the public at large expect you to know everything about every subject vaguely connected with property and sadly I don’t.

Recently I carried out a number of valuations on properties held in shared ownership schemes. So I decided to find out more about such deals, particularly as they’re the only way my children are going to get on the property ladder.

There is a wonderful initiative called Social HomeBuy, through which housing association and council tenants can either buy outright the property they are renting or opt to take a share in it.

The tenants arrange a mortgage on the portion of the property they can afford to buy and then pay a subsidised rent on the remainder.

This scheme is now operating successfully in a number of areas of the country, particularly London. It’s a good idea and has to be the way forward. The lowest share that can be purchased is usually 25%. And as an incentive to buy, any tenant purchasing outright can claim a discount of £16,000. But if a purchasing tenant sells up within five years it has to be paid back.

Clearly there are echoes here of Margaret Thatcher’s Right to Buy revolution, which changed the UK’s attitude to property ownership.

The one aspect of Right to Buy I didn’t agree with was the option it gave tenants in its early days to buy council houses at a whopp-ing discount and then sell them on within three years.

I’ve always believed purchasing tenants should have been forced to pay back at least a percentage of their initial discounts. But that would not have been a vote winner.

No such concerns for Gherkin architect Norman Foster. He’s just sold the top floor of his penthouse flat in Riverside One, overlooking the Thames at Battersea.

Foster designed the apartment himself and is keeping the floor below for his own use. The bit he is selling is 12,000 sq ft, for which he’s receiving £12m. This works out at £1,000 per square foot, which for anyone interested is a record for this part of London.