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How the Joint Equity sale process works
► Comparison between Joint Equity & Traditional Sales?
Flat A is valued at £125,000
► Traditional sale method
The Buyer buys 100% of the equity £125,000
Income to Vendor £125,000
However, the buyer needs :
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a deposit and fees of £25,000 and
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a salary of at least £28,500 for the mortgage.
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They may not have either or both.
► Joint Equity sale method
The Buyer: 50% equity £65,000
Investor-Partner: 50% equity £65,000
The total sale income is still £125,000
– the same as traditional sale.
But, with Joint Equity the buyer (the Owner Partner) only needs:
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a deposit and fees of £9,500,
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and a salary of only £18,600.
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This is a :
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38% saving on deposit and fees
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35% lower salary requirement
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This simple comparison demonstrates how the Estate Agent can make the properties financially attractive and available to the widest possible audience, as well as how the social affordability criteria are achieved.
