For us, shared ownership was a way to escape constantly having to move from one private rented flat to another. We never intended to move again. But now all we want is to sell and get out, ideally, without being financially ruined in the process.
It all started in 2017 when we bought a 40% share in a flat from a housing association. (At the time they were Viridian, then became Optivo and now finally Southern Housing).
Our new home had serious safety flaws
Unfortunately for us, in 2020, we were informed about serious safety flaws. Our block of 30 flats was built with flammable cladding, which became illegal after Grenfell, and with missing fire break cavity barriers which was never legal. It should never have been signed off. Yet it was sold as safe, at full price, to many unsuspecting leaseholders.
Eventually, after many sleepless nights and hours of our time lobbying – alongside help from our local MP – in late 2022 Southern Housing informed us they would pay for the necessary works rather than charging the full cost to residents. The building safety remediation works started in June 2024 and are ongoing.
In November 2024, an internal Type 4 survey was carried out. This survey found defects internally which require further works. We’re still waiting for information about the extent, disruption and planned dates. And we only found out very recently – after months of pushing – that we won’t be charged for these additional works.
Given the building safety issues it has been extremely difficult to sell flats in this development, particularly for shared owners. It was never a realistic option to leave once the fire scandal had affected us. So, we planned to ride out the works as best we could. However, it hasn’t been easy.
I am a nurse and home was my place of peace to retreat to
The works are unbelievably disruptive. If you work shifts you can’t rest on days off as the builders work 8am-4pm. It’s so bone shakingly loud that someone’s fire alarm came loose from their ceiling and smashed their dining table. The plaster pops out from the walls. There are constantly people around, voices, clanging. We could only open the windows around 2cm due to scaffolding. We can’t use the balcony. The garden is entirely full of construction buildings and rubbish. There is no peace.
I am a nurse and my work is stressful.
Home was my place of peace to recover. Now it has become nothing but a source of massive stress.
A chance to get out
Eventually, with safety sign-off in sight, we thought we might have a chance now to get out. Even though the works will end this year, the way we have been treated by Southern Housing throughout this scandal convinced us we could not continue having to deal with them any longer.
In shared ownership the selling process is complicated. You must have a RICS survey by a company on a list from Southern Housing. The housing association then have 8 weeks to sell the share before you can list the property on the open market and try to sell it yourself.
Our RICS valuation was carried out in October 2024 and came back low – only £350,000. When we bought our share, the flat was ‘worth’ £460,000. The valuation was a significant blow and we actually challenged the surveyor thinking he had made a mistake. However, the explanation he gave – ongoing works and lack of current EWS1 – made sense. Consequently, we decided to go ahead and accept the loss of money. We were so stressed that we just wanted out at any cost.
Southern Housing couldn’t sell our share
Southern Housing received our RICS valuation, and listed the flat through their channels. As expected, we had no viewings. (We knew from other peoples’ experiences that the housing association do not actively market flats and that we would be highly unlikely to find a buyer that way). Only one person requested a viewing but they cancelled after I told them there were ongoing works. Southern Housing listed the flat with an old external photo and I felt it very unfair for someone to turn up, without warning, to a building site.
Southern Housing is frustrating our attempts to sell on the open market
In early January 2025 we listed our flat on the open market, with Southern Housing’s written consent. To our intense relief, a potential buyer came to see it in the first week and put in an offer at the asking price.
In that same week, the Southern Housing sales team contacted us to say they had just noticed the flat was undervalued. We explained the reasons it is not: no EWS1, ongoing building works, and an outstanding Type 4 survey – not to mention the fact that the flats are a building site, and hence extremely unattractive to buyers.
One of their arguments seems to rest on implying that we were not honest with the surveyors about the end date of the works. Southern Housing say that: “The remedial work may have initially deterred potential buyers, but given that this work is almost complete, it should not have a significant impact on the valuation”. But this was not the view of our RICS valuer.
Southern Housing have also suggested that because we are not charged for the works, the flat should be full market value. However, this was known and stated in the original valuation report. The value was still returned lowered due to ongoing remediation works.
Meantime we accepted the buyer’s offer and he began buying proceedings; importantly, organising a mortgage survey. (People have severely struggled to get mortgages in the block and sales have fallen through due to this and the fire defects).
Our surveying company withstood the attempt by Southern Housing to influence a change to their October valuation. So, around two weeks ago, Southern Housing ordered a further desktop survey under RICs ‘Special Assumptions’. A Special Assumption is: ‘where the valuer bases their work on factors that do not apply at the valuation date, or that would not be considered by a typical market participant at that time’ and is therefore not the same as the ‘market value’ upon which shared ownership sales are based. The surveyor has confirmed that his original £350,000 valuation remains the current market value. Southern Housing will not accept this.
Excerpt from the desktop valuation commissioned by Southern Housing
‘We have further considered the requested RICS Special Assumption that the “full market
value, excluding any structural defects and EWS1 remediation works” be calculated, as per
your email dated 24/02/2025.‘
Also, given that our lease contract states that the valuer’s decision is final and binding, we consider that Southern Housing had no basis to order a second valuation.
Excerpt from our lease contract
‘It is hereby agreed that the decision of the Valuer shall be final and binding on the parties hereto’.
Doing the maths – how much will we lose?
Selling per our RICS valuation of £350,000
When we first purchased our flat the total market value was £460,000. Consequently, we paid £184,000 for our 40% share. Selling our 40% share for £140,000 means we would make a loss of £44,000 (£140,000 less £184,000) if Southern Housing accepted our RICS valuer’s valuation of £350,000.
| 40% purchase price | (£184,000) |
| 40% sale price per our RICS valuation | £140,000 |
| Our loss | (£44,000) |
Selling per Southern Housing’s valuation of £425,000
| 40% purchase price | (£184,000) |
| 40% sale price per HA valuation | £170,000 |
| Our loss | (£14,000) |
If we sold our share per the valuation from Southern’s Housing’s valuer, then we’d ‘only’ make a loss of £14,000. But this is merely a paper exercise.
We already have an actual buyer lined up on the basis of our £350,000 valuation. Although our RICS valuer informed us it would be within accepted margins of tolerance to increase his valuation to £375,000, his professional view was that we’d struggle to achieve interest at that price.
Southern Housing want us to cover their loss too…
Southern Housing continue to maintain that – on the basis of the £425,000 valuation – we would have to pay them £255,000 for their 60% share. Meaning we would have to cover their loss as well as our own if we sold to our buyer at the agreed price. This would greatly increase our loss, from £44,000 to £89,000.
| 40% purchase price | (£184,000) | ||
| 40% sale price per our RICS valuation | £140,000 | ||
| Our loss on our 40% share | (£44,000) | ||
| 60% sale price per our RICS valuation (£350,000) | £210,000 | ||
| 60% sales price per HA valuation (£425,000) | £255,000 | ||
| Our loss on HA 60% share | (£45,000) | ||
| OUR TOTAL LOSS | (£89,000) |
We think, despite Southern Housing’s assertions, it is highly unlikely our home will sell at anything like £425,000. It simply does not make sense to buy a flat on a building site with outstanding work, at full price. But, if we cannot sell, we are stuck here paying rent and service charge to Southern Housing.
There is no way out. A solicitor advised us that legal action would be prohibitively expensive. Of course, the housing association know this. They can be complacent about putting us in this position since they win either way.
Shocking, it’s time these housing associations were held to account.
This is a nightmare! Challenging the rules they set when circumstances mean they don’t like the outcome.