Selling AH - Lower than the Valuation?

phil1147 said:
There are 2 bedrooms in the apartment. One bedroom is already taken up with my girlfriends 5 year old child and its a very small room.

Factoring in the possibility of having more children before buying... i really wish i was psychic but its not the case.

I was talking to the council today, they said that there is a stipulation in the contract that affordable house buyers dont make a loss when they sell for lower than the market value. Good news in a way but bad news that we will have to fork out for stamp duty and mortgage down payment.
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Surely if you sell your affordable property for less the price you actually paid for it you will make a loss regardless of clawback issues.

At this stage in the property cycle most affordable units have dropped well below qouted market values at time of purchase and indeed in a lot of cases below the actual price paid.
 
Can anyone confirm whether the affordable homeowner takes the loss in such a case as the above? I'd assume so?
 
affordable housing no longer affordable?

Hi,

just a question any help would be great,

the market has obviously crashed and the value of my property has fallen way below the price i paid for, what are my options, considering the apartment is no longer deemed "affordable"? i bought in 2008 and it felt like a good idea but surely the council would have foreseen the price drop and put in place if this happened.


Also the apartment next door is being allocated for social housing, even thought its a private apartment block.

Thanks

mark
 
lilbear1 said:
the market has obviously crashed and the value of my property has fallen way below the price i paid for, what are my options, considering the apartment is no longer deemed "affordable"? i bought in 2008 and it felt like a good idea but surely the council would have foreseen the price drop and put in place if this happened.
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Your options would be the same as if purchased on the open market. You wouldn't have to pay any clawback if you sold now, but you would have to pay off your mortgage in full.

As for the issue of social housing going in next door. Many private owners rent out their properties as social units so you probably don't have any come back. You might have grounds to complain if you were told that the entire block/road would be designated affordable and the council have changed that and the majority is now social. I doubt there is much you could do now though, I am in a similar situation - bought 2008 and now worth a bit less than what I paid, not too much thankfully so consider myself lucky.

There was talk of some unsold affordable been redesignated as social in our area but AH owners opposed this and the council have lowered the AH prices and are selling on the open market rather than turning unsold units to social. We have some recourse because the social/affordable/private mix is already at maximum levels for our area.

You are probably stuck unfortunately. The council don't have any further obligations to you.
 
Cheeus said:
There was talk of some unsold affordable been redesignated as social in our area but AH owners opposed this and the council have lowered the AH prices and are selling on the open market rather than turning unsold units to social. We have some recourse because the social/affordable/private mix is already at maximum levels for our area.
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Hi Cheeus, and soory op for hyjacking your thread, could I ask you how you went about getting the unsold units to remain as afforable. My friend is in a similiar situation and would prefer the development to be mainly affordable as she had been told that was the division of the complex when she bought. The difference from your situation though is that they have already redesignated them as social. Any insight you could give me would be great. Thanks

For the OP, if you sell for an amount under what you are mortgaged for, the difference has to be paid back to the bank by you. Its the only case I believe with the affordable housing scheme that you can be in negiative equity. i.e. you sell for less than you are mortgaged for.
 
Seonewbie said:
Hi Cheeus, and soory op for hyjacking your thread, could I ask you how you went about getting the unsold units to remain as afforable. My friend is in a similiar situation and would prefer the development to be mainly affordable as she had been told that was the division of the complex when she bought. The difference from your situation though is that they have already redesignated them as social. Any insight you could give me would be great. Thanks
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We just kept abreast of plans re minutes of council meetings and wrote and rang with our objections based on the fact that we were assured they'd all be affordable at time of purchase and that the quota for the area had already been reached.

We can't say that we had a direct impact, but council know that we're monitoring it and will lobby further. Sometimes the council weren't lowering their prices enough for sale or weren't making the same efforts as other sellers in the area. You have to be proactive about monitoring it, there have been times when we knew more than the council - eg that privately they were selling for less than the AH price and we'd have to point it out. It's disgraceful really, they'd have been all sold long ago if the council were on the ball.
 
JohnJay when you sold how long did it take you? I am looking at putting mine on the market on in May for €140k I have a AH with GCC
 
I was dealing with Fingal Co Council. They were quick enough, I sent them a letter before I put it on the market to tell them that I was about to sell. Then when I found someone to buy it, I contacted my solicitor and she did the rest. There was a few forms to fill in (stating that I wouldnt be going back to the council looking for a council house, etc), and my solicitor requested the deeds. The whole process only took a few weeks.

I'm glad I sold now, properties in the same development are now selling for about 30k less!
 
simon1 said:
Hi folks,

I'd also be interested in how people are getting on selling their affordable homes in the current market. If the council value the property quite high, and you are having trouble selling, is renting it out an option? I know you're not meant to do it but is anyone actually checking up? Is there a way for them to track if someone is renting their place out?

Thanks in advance,

Simon1.
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I spoke to DCC last year about this, and they said they that although against the rules, they don't really care if people rent and they don't check up.

They said, they understand that people circumstances change and in the current climate people can't sell the AH, so the only option is to rent.
 
Hey I dont understand if you were in such a situation where your girlfriend is expecting, why dint you give a thought to it earlier. I guess this is not a correct move you are supposed to be taking, just give a second thought to it, cause the baby which going to be born wont ask with you for a separate bedroom,am i right?
 
BobMartins said:
Hey I dont understand if you were in such a situation where your girlfriend is expecting, why dint you give a thought to it earlier. I guess this is not a correct move you are supposed to be taking, just give a second thought to it, cause the baby which going to be born wont ask with you for a separate bedroom,am i right?
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Peoples life changes daily.. such things are not always planned. silly comment if you ask me
 
Hi
Can anyone tell me what is the first step I need to take in order to sell my affordable home? Bought in 2008 and want to sell it now, rushed into it to be honest. Thanks
 
Hi Creambun. You need to get your place valued and then let the council know in writing of your intention to sell with the valuation figure and the estate agents details. If you go onto their website there is a section in Housing under the loans and loan arrears heading that will tell you what you need to do. They should get back to you with a redemption figure which is the final amount you owe them (as I understand it). This includes the clawback if it applies plus any break out fee you have to pay (only if your on a fixed rate mortgage).
 
I'm confused about the clawback - I thought that for example if you boughht for 200k (m.v. at time 300k) i.e. a 32% reducation and then sell now for 280k that the person would only have to pay back to the Council 32% of the profit i.e. 80k not 100% . I thought that after 10 years the clawback i.e. 32% reduces by 10% every year. Can anyone clarify this? Thanks
 
You're right when you say the clawback reduces by 10% each year after 10 years. Not sure how the rest works. I think there are a few other threads about it here somewhere. The only thing I can say for definite is that the clawback does not apply if you are in negative equity.
 
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