Young woman struggling to buy first home hits out at 'unfair' shared ownership premiums in Milton Keynes

Jessica Walden and her partner want to get on the housing ladder by buying through the shared ownership scheme.

Designed for those who are unable to afford a high mortgage, the scheme enables them to buy a percentage of a house and pay rent for the remainder. They can then add to their share if they wish, when they can afford it in the future.

Dozens of the shared ownership homes in MK were originally built by the development corporation and now the lease has been transferred to Milton Keynes Council.

The system is so popular locally that sellers demand a 'premium' payment - a sum of money allegedly to cover the fixtures and fittings or 'improvements' made to a property. And some of these premiums can be as high as £30,000, says Jessica.

"This has to be paid upfront on top of your deposit, equating to up to £50,000 in all. It cannot be added to the mortgage," she said.

"We are really struggling, which I’m sure many more are too. The council were meant to investigate this problem last year but nothing has changed and the premiums are just getting higher.

"They are not for fixtures and fittings because all of the properties have had no work done. When I spoke to an estate agent she said it’s simply for demand of the property. This allows them to bypass fixtures and fittings as it wouldn’t pass a surveyor and to just put whatever price they like on top whatever the condition of the property," she claimed.

One such house is in Dulverton Drive in Furzton, which is on the market with Upton & Rural estate agents for £160,000 for a 50 per cent share. The remaining 50 per cent belongs to MK Council.

For this three bedroom property, the premium is £25,000, bringing the total 'price' to £345,000 for the shared ownership buyer.

Jessica said: "I find it bizarre that this system seemingly only exists in Milton Keynes and allows people to bypass fixtures and fittings and charge these absurd amounts simply for demand on the property.

"People are pocketing money for free. We shouldn’t need to pay this upfront for shared ownership."

She added: "You would need less of a deposit buying outright which then makes the shared ownership scheme void. House prices in Milton Keynes are already high, resulting in a higher deposit to begin with. The premiums are stopping young people from getting a chance on the property ladder. When you cannot borrow a full house price this is their only option.

"I have started a petition called 'Abolish premiums on shared ownership houses in Milton Keynes'. I really just want to bring some noise to the situation in the hopes the council will investigate the problem."

In the first two days, the petition gathered more than 200 signatures. It can be viewed here .

MK Council says shared ownership is a form of "low cost home ownership" and offers a route into owner occupation for those who would not normally be able to afford their own home outright.

A spokesman said: "The council has an interest in a number of shared ownership properties, most of which were originally built by the Development Corporation. The majority of the properties are houses but there are a number of flats and bungalows.

"By buying a share in the property, the purchaser may pay a mortgage on the purchased share and will pay a rent on the unsold share of the property.

"As part of your decision to buy your home, you need to consider the charges we make towards the upkeep of the local estate or block you live in.

"A shared owner may buy more shares in their property, which is called staircasing, and eventually can own their home outright."