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Stuart J
Stuart J, Property Solicitor
Category: Property Law
Satisfied Customers: 22927
Experience:  Senior Partner at Berkson Wallace
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I've started process of selling shared ownership 25% share

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I've started process of selling shared ownership 25% share from MOAT in May. Buyers bank wouldn’t approve mortgage until Managing agent would provide cladding survey. After pushing for the managing agent to get this done and months waiting for the report the sale fell through as the cladding used showed is Euroclass B which no longer comply with the government regulations.
Me and my partner in a meantime exchange on the new house.
Now I’m stuck with 25% of unsellable shared ownership and the mortgage on the new house. I was told once we complete I will also have to pay higher stamp duty even though my share is only 25%
I have spoken to bank and housing association about option to sublet until issue is resolved. The bank agreed and so did MOAT in principle but their tenants criteria are so tight so it will be impossible to find someone.
As freeholder, managing agent nor MOAT followed the government guidelines with regards ***** ***** I’m now left with bills worth of £2000 for solicitors, valuations, managements packs, etc.
I also have to pay additional £450 for deed of variation if I sublet and I have to come up with extra £10k towards mortgage and £12k for additional stamp duty.Any advise will be appreciated.
JA: What steps have you taken so far? Have you prepared or filed any paperwork?
Customer: none apart of talking to the housing association
JA: Have you talked to a lawyer about this?
Customer: no
JA: Anything else you want the Lawyer to know before I connect you?
Customer: no

I have been asked to look at this for you.

I apologise for the delay in getting back to you.

I need some more information from you please.

Provided the original property sells within 3 years, you can recover the additional stamp although I accept that your cash flow would take a huge battering meanwhile. It would not matter if you only had 5% shared ownership, you still pay the extra stamp duty and for that matter, it wouldn’t matter if you had 5% of a house in outer Mongolia, you are still a second time buyer. Duty purposes.

Unfortunately, with the situation as it is in England & Wales, if a sale or purchase., Then each of the parties takes it on the chin. There have been lots of moves to get the law changed but the government seems to more concerned with enforcing parking charges in supermarkets.

I’m afraid that you are one of thousands of people in exactly the situation where you have share in the property which is not saleable and which is going to have to be greatly modified. There is absolutely no way around that because the lender will not lend on a non-compliant property. In fact, I have another customer who was asked a similar question where the mortgage is approved subject to the cladding being replaced and the cladding is scheduled to be replaced in February but the lender will not do anything until it has been done and all signed off.

I wish I could give a solution for you but until the cladding is changed, you are stuck. However if you under all the other property owners get your heads together, you could put pressure to bear on the freeholder/managing agent to do the work. It won’t help you in the short-term however. I’m sorry, I know this is not the answer you wanted.

If I have answered your question for you, at the top of the page, you should see a rating facility. Can you please rate my reply 3 stars or more because that really helps me? Please note you are not rating whether it’s favourable, because sometimes you may not get the answer you want, but basically my knowledge and way of dealing.

The thread does not close and I am happy to answer any questions you may have arising from this.

Kind regards

Customer: replied 5 days ago.
Many thanks Stuart, I understand that. However my question also is if there is anything I can legal do as the freeholder, managing agent and the housing failed to disclose this information. Surely they would have known that the cladding report is enquires as my property is not the only one being sold. This has already left me out of pocket by around £2000 and now they want more money to give me permission to sublet. Surely these are special circumstances and housing association should be bit more understanding. There is just no way I can pay 2 mortgages. Any legal advice on this?

I’m sorry to say that they are not under duty to disclose anything unless asked. Caveat emptor applies, buyer beware.

It is now a standard enquiry as to whether the cladding is compliant, but it wasn’t when you bought this.

That is why the issue has cropped up now but didn’t crop up when you purchased.

Whilst they may be special circumstances, and I agree with you, and I think the housing association should be a bit more understanding, they are not under a duty to do so.

There is something that you can do at least which is free and that is make a complaint to the Housing Ombudsman.

If you could help me now please, in the way that I have helped you, I would be obliged if you could please use the rating service because that gives payment for my time and expertise here today.

If anything else crops up, we can still exchange notes. The thread doesn't close.

Kind regards.

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