What is staircasing?
Staircasing is the legal process that is used by the Leaseholder to acquire further shares of their shared ownership home.
The greater the share you buy in your home, the less rent you will have to pay.
The amount you can step up by, or ‘staircase’ is done in increments that are called tranches: these are usually detailed in your lease and will be the percentage you can increase by.
In most cases you can staircase up to the maximum percentage which is dependant on the scheme and planning criteria. This can range from 70% to 100%.
If the details in your lease allow you to staircase up to 100%, then you will become an outright owner and may also be able to acquire the freehold to your property (houses). You will no longer pay any rent, but you may still need to pay service charges (flats) and/or estate charges.
It is important that you read your own lease or transfer agreement to know whether you can staircase, and any conditions that may exist for your property.
Can you buy more shares?
Most leases allow you to buy extra shares after you have owned your initial shares for three months, subject to the value of your mortgage not exceeding your share value
Your lease or transfer agreement will tell you what’s possible for your home.
How do you buy more shares?
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If you are considering staircasing, you will first need to find out from your lender whether they are willing to lend you a further advance based on your current circumstances. The amount you are able to borrow will help you determine the size of the further share you are able to purchase.
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If you are considering changing mortgage providers, you need to consider if your current mortgage has any redemption penalties.
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Contact us by email at Conveyancing@sanctuary.co.uk.
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Within 10 working days we will send you the sale procedure with a valuation form for you to complete and return and confirmation of the valuation fee payable with our bank details.
What happens then?
Once we receive your completed valuation form:
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We will instruct an RICS independent property valuer. Please note, as Landlord, and under the capital funding guide, we must instruct the RICs valuation. Please do not obtain your own valuation as we will not be able to rely on this.
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The valuer will then contact you directly to arrange a valuation subject to their availability.
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The valuer then sends the valuation report to us and we will aim to provide you with a copy of the report within five working days. We will also confirm the price for the share that you wish to purchase.
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You will then need to confirm in writing to the Legal Assistant your intention to proceed and confirm your solicitor’s details to us.
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We will then instruct our solicitors or Sanctuary’s Legal Officer to progress with the legal sales process.
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Once the legal transaction has concluded (which can take three to four months) you will be notified of your share increase and rent decrease.
Please note that not all leases allow you to purchase all the shares in your home. If you are unsure, please obtain independent legal advice. Please also note that leases are subject to planning conditions which may impact your ability to staircase (for example if the property is in a designated protected area).
Contact us
If you want to enquire about staircasing or submit a valuation to us, please email Conveyancing@sanctuary.co.uk.