Actually it a question about "she needs to raise some money to buy the new place when it comes up, before she sells her house". Then "*the*
*other *factor* [my emphasis] was how any of this would affect her benefits". I don't think anyone other than you was considering her getting a mortgage.
I can't imagine them waiting years for their management fees.
It was about eight years ago we looked at such properties.
We did not find that they were selling slowly when we looked. Many sold at a premium.
That market should not be slow with an aging population. Notice that new ones going up are smaller (like Mars Bars) than they used to be.I was amused by one Macarthy & Stone development where they posters outside all showed rooms with big mirrors to make the interiors look bigger. I commented in one new development that they looked smaller than in the brochure. He told me that they use scaled down furniture for the pictures. Derek.
I came across one in Brighton at the time that looked a possibility. I phoned the agents who sounded puzzled at my request. They said that it had been sold three years ago but somehow had not been removed from their web site. Derek
It's certainly in the sales brochure for a retirement development - still being built - that my mother looked at recently. Fortunately, she wasn't serious.
"We take the view that the nature of transfer fee terms, coupled with consumers' strong behavioural biases, are such that there remains a risk of consumers suffering detriment.
8.14 We consider that landlords should not include or enforce transfer fee terms in newly created or acquired leases, other than in circumstances where the fee is for a service and is no more than the actual costs reasonably and necessarily incurred in providing that service, or where it is presented as a credit facility"
They can't actually enforce this if builders don't comply, but indicate they they well seek a change in the law if they don't.
It should be noted that it is perfectly normal to pay a service fee (of several hundred pounds) to the management company on any transfer of a leasehold property and that's the level of charge would be considered "reasonable" in 8.14
most people own these properties for a very short time span.
They can cover the costs of one person owing them 15 years back payments
At a premium, to what?
There's a marked reluctance from people of this age to move at all, and once they have decided to do so many will not want to move into "a home" even if it is one that they own (FSVO own).
The asking price. We were outbid by £48K on one. This was with the Scottish 'offers over' system.
We live in a non retirement block of 50 flats and the majority of owners are living alone. We even have a My Wife Next Door situation where a divorced couple unknowingly bought side by side Penthouses.
Macarthy and Stone ones certainly are. We looked at a couple of developments out of interest to see if the quality was as good as previously and they were very pricey and much smaller.
That must be in a very select location. Getting competing offers at all, let alone at asking price is just not normal for this type of property
Not sure I see the connection between living alone and living "in a home".
New builds are definitely overpriced. You get the hard sell from a commissioned salesman who doesn't have the worry of maintenance charges if he doesn't sell in a few months. Some blocks can take 24 months before they sell them all.
Though I really don't see how they can be smaller than they were. Perhaps where you are looking the older blocks were more generously built then where I am
That is the Scottish way. Very few sales are are at a set price.
I did not say 'home' but was comparing our block to retirement flats. Our wing has 26 flats. Four are kept as holiday homes by couples or families. One is rented out as a holiday flat. Six are lived in by two or more and fifteen by one elderly person. That seems pretty typical for our area of the South Coast. A recent national newspaper article blamed divorcees and trading down widows for pushing up prices and keeping young people out of the market.
All types of houses seem to have been scaled down. When looking at new ones we found Persimmon to best for space. If the person wanting to move has pots of money here is an option that would not cost her much more than £20K a year and she would have to leave when unable to look after herself.
All types of houses seem to have been scaled down. When looking at new ones we found Persimmon to best for space. If the person wanting to move has pots of money here is an option that would not cost her much more than £20K a year and she would have to leave when unable to look after herself.
We once met one of the managers and his wife who invited us for dinner and to show us round the complex but we did not take them up on it.
Can you? I did a search recently for someone on retirement flats in New Malden. I came up with one for £56K. Turned out that was for part share ownership in a Studio Flat with rent to be paid on for the part owned by the company. The advert does not say that.
Nope, just the level that the market price drops to when you need to sell a "restricted" occupancy property and you want to get rid of it ASAP to avoid the high service charges that secure accommodation attracts
Studios are undesirable purchases anyway. sometimes you really can struggle to give away retirement studios.
And I know that it's not a studio, but there's a one-bed near me that's restricted to "retirement age" so the market is very very limited. Bought in 2006 at the top of the market for around 200K. EA sales for this block advise 180K (ambitiously IMHO as unrestricted properties sell for that) . But one of the sellers gave up waiting for his lucky day and went to auction guided at 105-110. It didn't sell and when put back on the market it was revealed that the reserve was 95K.
It was going to go to auction again this week, but it appears that someone ponied up the 95K beforehand.
Only a fool pays 180K for this this spec property (and yes the fools do exists)
My view is that a scheme titled "Equity Release" normally has major benefits in capital gains for the lender, and doesn't seem to fit this requirement.
I would be interested to find out who gouges the house owner more - an Equity Release lender or a 'we buy any home' purchaser.
Both take a large cut of the market value of the house for providing their service.
It looks as though what you need is an interest only mortgage to purchase the sheltered housing flat.
You say that the the house is worth 'comfortably more' than the flat. How much of the equity do you need to release to buy the flat? Less than 50%? Or less than 80%, perhaps?
For such a scheme to work I would think that she would have problems if she wanted to borrow more than about 60% of the original property valuation.
One suggestion:
market the house immediately - if someone wants it very much before the autumn then she may reconsider and if not you have increased your chance of a sale at the right time.
borrow the purchase price of the flat plus 2 years projected interest payments on an interest only basis. This is much the same as taking an interest only mortgage and just adding the interest to the capital owed, but possibly more palatable to a bank or building society. Obviously no early repayment penalties or large up front charges.
They would require a repayment strategy for the loan, but they should be happy that it is the sale of the house.
There is a very clear risk in this sort of strategy - what if the house doesn't sell? You have to have a contingency plan for this, including selling the house at a much reduced price to limit your exposure to future loss and future interest charges.
Talk to mainstream lenders like the Halifax, rather than specialist targeted on releasing equity from (not for) senior citizens.
An illustration for equity release would be useful, however, to give you an idea of how much you can discount the house, or pay in loan interest, and still come out ahead of the game.
8 It even has a current tenant so it doesn't matter if you don't want to move in immediately yourself.
Current EA offers for this block 99-120K for 1 beds.
And just to show you how quickly people move in and out, it was only bought in 2011, and the price suggests not by a buy to let'er with tenant in situ, so the OO purchaser must have "been and gone"
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