b'4.0 / Future of Shared OwnershipSO Resi by Metropolitan Thames Valley 4.0 / Future of Shared OwnershipSO Resi by Metropolitan Thames Valley4.0 / Future of Shared OwnershipMaintenance costs Leasehold reformShared owners will remain responsible for repairs inside of the home but will be eligibleLeasehold reform is seen by many as a priority including the Government. The current system to reclaim costs from the landlord for the essential repair or replacement of (if faulty andis antiquated and open to unfair practices. Leases are often set at 99 years and it can impact not covered by warranty): installations in the flat or house for the supply of water, gas andthe value of the property when there are less than 80 years left. electricity and for sanitation (including basins, sinks, baths and sanitary conveniences,Extending the lease is costly involving valuation and legal fees. In extending the lease the but not other fixtures, fittings and appliances for making use of the supply of water, gas orhome-owner is, in essence, paying for the privilege of continuing to live in the home theyve electricity), pipes and drainage installations in the flat or house for space heating and heatingalready substantially invested in. water shared owners will be able to claim up to a maximum of 500 in repair costs per year. Repair and maintenance costs in excess of this will be the responsibility of the shared owner.Reform would give customers more control and influence and the right to scrutinise and We have included a cap to prevent misuse of the scheme and to limit the landlords exposure. question future expenses which they cant do with the current leasehold system.Re-selling The law commission has made a raft of recommendations for leasehold reform to bring it closer to freehold and looked at alternatives such as commonhold and trusts. Some changes If a customer wants to sell their property, the housing association has 8 weeks to find a buyerare becoming law in Aprila ban on leasehold house sales and restrictions on ground rents. from their waiting lists before the property can go onto the open market. The length of timeThe Government is also reviewing the system for evaluating the cost of lease extensions.this could add to the sale process is off-putting to some thinking about shared ownership. It is hoped that further recommendations will become law but given it is a complex system The Government is proposing to change the rules to speed up the process giving the provideruntangling it to make it fairer isnt easy. Many investorsincluding institutional investors4 weeks to sell. However, this doesnt factor in the time it takes to get a property ready toare invested in leasehold products.market. On the open market, an estate agent would normally tie in a seller for 12 weeks.And there are question marks over what happens to the homes in existing leasehold structures While this makes it easier for the owner, being able to offer properties to people waiting foronce changes are made. What impact could it have on values and ability to sell on? shared ownership is an important part of what housing associations do. It means more shared ownership product is available and allows people to upgrade to bigger properties. Such a change could reduce stock overall at a time when demand for shared ownership is increasing.Challenges and opportunities for delivery1% shareWhile the Governments proposals show a commitment to shared ownership, it is also Currently, the minimum additional share a customer can buy is 10% but each purchasepursuing First Homes in which homes are offered to first-time buyers at a 30% discount to carries with it valuation and legal costs on top. To make it easier for customers to staircasethe market value. And while there will always be demand for shared ownership because of the Government is proposing 1% shares with reduced fees.rising housing prices, the focus on First Homes could reduce the amount shared ownership MTVHs SO Resi (see comment p22) already offers the ability to buy an additional 1% sharehomes that are delivered. each year for 15 years without the valuation or legal costs and based on value increase of Gemma Burgess, Acting Director Cambridge Centre for Housing 3% per year. If the value of the property was to drop, the customer doesnt benefit but whatand Planning Research, University of Cambridge explains: The they do get is cost certainty each year so they can make an informed decision. consensus among providers is that they are planning to build In the Governments proposal, the value will be index-linked which removes the certainty ofmore [shared ownership] but if planning reforms go through costs of each share year on year and potentially makes it more complicated for the buyer.and First Homes become the preferred form of affordable housing then I suspect that will have an impact on the number of shared ownership homes that providers can deliver.16 / Shared Ownership Market Review 2020In conjunction with Cambridge University Shared Ownership Market Review 2020In conjunction with Cambridge University / 17'