Staircasing Property Valuation: Ascending the Shared Ownership Stairs

If you’re a shared ownership homeowner in London, you’ve likely heard the term “staircasing” before. But what exactly does it entail, and why is it crucial for your property investment? In this blog, we will delve into the world of staircasing property valuation, providing insights into the process and emphasising the importance of a property surveyor in London to make the journey smoother.

Shared Ownership in London

Shared ownership is a fantastic way for first-time buyers to get a foothold on the property ladder in London, one of the world’s most competitive real estate markets. It allows you to purchase a percentage (usually between 25% and 75%) of a property, with the remaining share owned by a housing association. This arrangement makes owning a home in the capital more accessible, as it requires a lower initial investment.

However, shared ownership isn’t meant to be a permanent solution. The goal is to eventually increase your ownership share in the property. This process is known as “staircasing,” where you gradually purchase more of your home until you own it outright. This is a significant financial decision, and the valuation of your property plays a pivotal role in this journey.

The Role of Property Valuation

When you decide to staircase, the property’s current value is assessed to determine the price you’ll pay to increase your share. This valuation is essential because it directly affects your financial commitment. The higher your property’s valuation, the more you’ll have to pay to purchase additional shares. Conversely, a lower valuation means a more affordable step up the property ladder.

A qualified property surveyor in London is crucial in this process. These professionals have the expertise to conduct accurate valuations, taking into account various factors that can influence a property’s worth, such as location, condition, and market trends. Their objective assessment ensures that both you and the housing association are treated fairly in the staircasing process.

The Staircasing Process

Here’s a simplified overview of how the staircasing process works:

Initial Shared Ownership Purchase: The process begins when an individual purchases a share of a property, typically between 25% and 75%. This means they hold a lease on that portion of the property and pay a mortgage on it, along with rent to the housing association for the remaining share.

Staircasing Interest: Over time, shared ownership homeowners can opt to increase their ownership stake in the property by buying additional shares. The minimum additional share they can purchase is usually 10% of the property’s current market value.

Property Valuation: Before staircasing can occur, the property’s current market value needs to be assessed. This valuation is carried out by an independent property Valuation London to determine the fair market price at the time of staircasing.

Staircasing Process: Once the property’s current market value is determined, the homeowner can express their intention to staircase. They must contact their housing association and agree on the additional share they wish to purchase.

Financing Staircasing: Homeowners often secure a mortgage to finance the purchase of the additional share. The housing association may have preferred lenders or mortgage providers for this purpose.

Legal Process: A legal process is involved in staircasing, which includes amending the existing shared ownership lease to reflect the new ownership percentage and rental arrangements. This process typically requires legal documentation and fees.

Ownership and Rent Changes: After staircasing is complete, the homeowner’s ownership stake increases, and their rental payments decrease, as they are now responsible for a smaller portion of the property.

Repeat or Achieve Full Ownership: Homeowners can choose to repeat the staircasing process periodically until they own the property outright (usually 100% ownership), eliminating the need for rental payments to the housing association. This transition to full ownership is often the ultimate goal for shared ownership homeowners.

Why You Need a Property Surveyor

A property surveyor is your advocate in the staircasing process. They provide an unbiased and professional assessment of your property’s value, ensuring that the pricing is fair and accurate. Their expertise can also be invaluable during negotiations with the housing association, helping to bridge gaps and reach a mutually beneficial agreement.

Final Thoughts

Indeed, staircasing property valuation is an integral part of the shared ownership journey in London. It allows you to gradually increase your share in your home and move closer to full ownership. If you, too, need the assistance of a property surveyor in London, we highly recommend reaching out to Aston James Associates. With a team of experienced and highly-trained individuals at their disposal, they promise to help you make the most of your investment. Contact them today to acquire their services.