Hi there I was wondering had anyone who bought an affordable housing apartment rented out the whole thing? my circumstances have changed somewhat and I intended to go traveling next year, at the moment I have one person sharing my 2 bed apartment with me which I think is allowed but I wanted t rent out my room too which would mean that both rooms are rented out. I think it's unreasonable that they would not give people some flexibility in this area considering most of us are young and single. Whats supposed to happen when we meet our future husbands/wives etc what happens when we have children? are we all supposed to fit in a 2 bed? If their suggestion is for me to sell it if I want to go traveling well then I think that that is very unfair as I hoped never to have to sell it
renting out affordable housing
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Pants,
I believe there is some flexibility allowed in certain circumstances as long as you are not abusing the spirit of AH. I think if you want to go travelling for a year this will probably be allowed. You should ring your council and ask them. That way you will know for sure
I believe there is some flexibility allowed in certain circumstances as long as you are not abusing the spirit of AH. I think if you want to go travelling for a year this will probably be allowed. You should ring your council and ask them. That way you will know for sure
There are a couple of threads on this issue already.
Whatever about the terms & conditions of the AH contract if the property is rented out and ceases to be your PPR there would presumably be the normal tax and other implications (e.g. some or all of SD clawback, CGT on some portion of eventual resale value, income tax assessment of rental income, PRTB registration requirement etc.)?
Whatever about the terms & conditions of the AH contract if the property is rented out and ceases to be your PPR there would presumably be the normal tax and other implications (e.g. some or all of SD clawback, CGT on some portion of eventual resale value, income tax assessment of rental income, PRTB registration requirement etc.)?
Clongriffin
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If you want to rent your place out, however as you stated you dont want to ever have to sell it, then they would suggest buying them out and paying them the claw back and owning it privately. Then it will be yours to do with it what you wish, and you would have no queries regarding renting it, and you will also not be selling it. Regarding renting out an affordable house, its a no no when it comes to the council. Its part of your contract agreement that you signed with them. So there is the option of buyin them out as long as you meet all the criteria.
I don't think the OP bought his AH property with the expressed intention of becoming a property investor. It's quite normal for someone who's young, free and single to up sticks and do a bit of travelling. However what's not normal is for someone who is this way disposed to undertake, or be allowed undertake, the financial commitment that is servicing a (35-40 year?) mortgage.
Maybe the AH scheme should have a lower age limit.
This isn't a criticism of the OP but you have to accept the fact that you made a huge financial commitment, you may not have really been ready in your life to do so but it's done now. This comes with all sorts of legal strings attached. This is life.
Maybe the AH scheme should have a lower age limit.
This isn't a criticism of the OP but you have to accept the fact that you made a huge financial commitment, you may not have really been ready in your life to do so but it's done now. This comes with all sorts of legal strings attached. This is life.
truthseeker
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Excellent points made here. Certainly from friends (and what I have read on here) a lot of young people dont realise the depth of the commitment until the deal is done.
Yeah - surely the least that local authorities could do is to subsidise wannabe landlords in buying their first investment property...
I don't want to be a landlord and I have lived here for a number of years, however I think they should allow some flexibility considering most people who can't get on the property ladder can't do so because they are on a single income and/or are young! being single and young it's extremely likely that unforseen circumstances may arise. It's difficult to predict what way one's career is going to go etc
ye I kow what you are saying and I don\t for one minute regret buying my home but I just can't really understand how they expect your situation in life never to change! Now that Im writing this I think I can remember somewhere that you have to live in your place for a minimum of 5 years, can anyone confirm this or am I making it up
They don't! That's what YOU were supposed to be doing. Before you make large financial commitments in life you're supposed to think a few years down the line and weigh up what the right option is for you.
You say these things to a 10 year old and worry that maybe you're patronising them. You shouldn't have to to an adult.
Clongriffin
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thats not really true, you are still getting the property at what it cost to make the property, not what it cost (market cost) so even if you buy back the claw back and all, your still getting it alot less than what the property is worth.
Also, you made the committment of a mortgage of 30 years or more, you cant then say, but i'm young, i may not wnt to fully commit, ya know. If you felt you were too young to committ to the affordable housing process maybe you should have waited until you had your travel etc out of the way. I know i did. I am 31 and was 30 when i bought my property, cos i was ready to settle down and accept the mortgage and affordable housing terms and conditions. I think its a huge shame that people dont know the full in's and out's of their terms yet they sign these documents which in turn is the biggest loan they'll ever take out in their lifetime. It's mad, if you bought a car, i'm sure you'd check out every term and condition (eg. previous owners, price, services, mileage and so on) yet some will sign a mortgage agreement without even checking if they are aloud to rent the property. I'm lost on that one.
My final advise would be to ring DCC or what ever council you have gone with, explain to them and ask them. I'm sure they will tell you the same as everyone on this site, you signed, you cant rent affordable housing, you're stuck until you buy them out.
I did read the mortgage agreement but I can't remember anything about renting it out, regardless I still would have bought as I wanted to settle down too. The best thing I ever did was buy my apartment, I love it and it's my home but sometimes things happen that we can not forsee, things happen in your career, things happen in life that can't always be planned for. When I took out the mortgage I didn't realise I was signing a guarantee that nothing unexpected would arise! if you don't mind me asking what are you going to do when you have kids or get married etc?
ps: just so we are clear on this I have no intention of pulling the wool over the council's eyes, I think the AH scheme is great and I feel very lucky to have been given the opportunity to get a great apartment in a great place. I hate the idea of people taking advantage of it and I wouldn't do it myself.
ps: just so we are clear on this I have no intention of pulling the wool over the council's eyes, I think the AH scheme is great and I feel very lucky to have been given the opportunity to get a great apartment in a great place. I hate the idea of people taking advantage of it and I wouldn't do it myself.
Clongriffin
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Ok i was probably a bit harsh, but a few other threads had started out asking questions like that to find someone was trying to buy the place through AH just to rent out.
I have bought the council out of the claw back, so its actually owned privately now, so if i have kids ill sell and move into a house. however alot of ppl dont mind living in an apt with kids, so its everyones preference really. If your situation changed, eg. had kids etc, you can sell still and pay the claw back to the council.
I know it seems unfair re; renting out the property. But it has to be done. I think the way the council work it is, NO renting, prevents the AH scheme been taken advantgage of. I dont think they can say, ok,,,, lets see the circumstances, however, dont get me wrong, if you ring them explain your situation and ask them what they advise you to do, i'm sure they will help, but if you do this, Pleaseeeee my advise would be to get their name, and ask them to put anything they confirm with you in writing. E.G yes.. you can rent for the year... then get them to put it on paper. I'd a few issues when buying them out, and after the first one or two situations, i asked them to put everything in writing. It stood by me, and i actually managed to buy my property before the year was up, due to me having written evidence that they told me i could once it was land registered.
affordable housing does allow for renting out in certain circumstances - i.e living abroad for a year etc but the fime on the clawback freezws - i.e if your clawback is 20 years and you go travelling for a year but rent the house/apt out the time is calculated on you living in the place for 20 years - if you contact your council they will clarify this - i did ask about this when applying (in case i ever took a career break and wasnted to travel for a year or two ) and this is what i was told
I would have thought that the contract rather than the mortgage agreement would be the place to look?
It's your responsibility to anticipate, plan for and deal with such matters - not the local authority's etc.
Your purchase contract should clarify. Or contact the LA and/or your solicitor for info/advice.
I have herd this been mentioned before, and I will be making sure that this is part of the deal. If I did want to go away for a year or two, and I am not saying I even ever will, but If I was to go away and get permission from the council to rent out the apartment, I would have absolutely no problem with the period being frozen out of my claw back period. I am thinking that maybe this is the way the councils deal with this scenario?
Obviously It will be my personal aim to try and buy out the claw back as soon as possible but as I am getting a 45% discount that may be some time yet.
I have made the same points as the OP that sometimes life can throw unexpected events at you. I have pre-warned my solicitor that I will be expecting them to go through the contracts with a fine tooth comb, and If I feel that there is not some fair way of dealing with this scenario I will not sign the final contracts. I can not stress enough that I think the AH scheme is an excellent way for people to gain a home and I would never want to see it exploited, but there simply has to be some flexibility in there. Down the line when I get legal clarification on all this in relation to my own contracts at least, I will most definitely post the outcome. I for one will not be blindly singing anything. I intend to be fully informed about what I can and can’t legally do with my AH unit.