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R.I.C.S

STAIRCASING

Buying Further Shares in Your Home...

The following guide will take you step by step through the process you must follow.

Having decided that you want to increase the size of your first share, the first thing to do is to decide how you are going to finance the purchase. It is likely that you will need a further mortgage advance in which case you should check with the lender that you will get this.

WHY IS THIS NECESSARY?

You will have to pay for the valuation report, the price of which will depend on which valuer is used, You should expect to pay a fee of approximately £100 + VAT.

We will check your lease and confirm in writing the value and the fee once you decide to go ahead.

Please note that you will have to pay for the cost of the valuation even if you change your mind about buying once we confirm what the share price will be.

IS THE VALUATION BINDING?

Yes. In general terms, the valuation will determine the price for further shares. However the valuer will take account of any enhanced value due to structural improvements you have made. Any such improvements will be valued separately so that you do not have to pay twice for your investment.

HOW DOES THIS WORK?

This is best demonstrated by an example:

100% value of house: £150,000
Increased value due to improvements: £10,000
Total market value: £160,000

If you own 50% then you would be able to buy the other 50% at the current valuation less the improvement value, i.e. £75,000. You do not pay any of the enhanced value.
 

WHAT IS THE MINIMUM SHARE THAT I CAN BUY?

The minimum share value is 10%, therefore if you originally bought 50% then you could increase your ownership to 60%. Alternatively you could buy the remaining 50% in one go in order to own the property outright, i.e. 100%.

The rent you pay will reduce in line with the share you are purchasing.

Should you decide to buy the remaining share in your home so that you own it outright, we will automatically transfer the freehold of the property (if it is a house) into your name, once you complete the purchase.

HOW LONG WILL IT TAKE?

Once the price at which you can buy is known, we will notify you in writing. If you decide to go ahead, you must tell us the name and address of the solicitor who will be acting for you. This is so that we can give our consent to the sale when you are ready to complete. In general terms the normal time for conveyancing is around three months.

It should be noted that the valuation is only valid for a period of three months. If you do not complete your purchase within the timescale it will be necessary to have a revaluation or a confirmation that the valuation is still correct. There may be an additional charge if a revaluation is necessary. In practice this rarely happens.

IS THERE ANYTHING ELSE?

It will be a condition of the sale that you ensure that your rent account is fully up to date before we grant our consent. Your solicitor will usually check the position with us at the point of completion.

You will be required to sign a staircasing agreement once you decide to proceed. This sets out the terms and conditions by which you will be bound.

WHAT DO I DO NEXT?

Should you decide to buy a further share, please complete and return a pre-paid staircasing card, you can request one by emailing sales@waterloo.org.uk. This will give us the necessary details and authority to instruct the valuer.

You will be sent an acknowledgement card within seven working days. If you do not receive this, please telephone the office to ensure that it has not gone astray.