When it comes to staircasing in your Shared Ownership property, you will have to pay for the value of the equity you are buying from your landlord, most likely a Housing Association, but you will also incur some extra fees. Below we outline what they are, why you are charged them and how much they cost on average.
RICS Valuation
This is likely the first thing you’ll have to pay for when staircasing. You cannot staircase without a RICS valuation, because you need an independent party to decide the purchase price of the property. A RICS valuation involves a surveyor coming round to your property and telling you what it’s worth in their opinion, so you are paying for their time. We would advise to budget between £250 and £450 for a RICS valuation.
Top tip: Often your Housing Association will have a panel of local surveyors who give discounted deals because of the volume of business that is sent their way. Check your landlord’s website for these.
Legal Fees
Engaging with a solicitor or conveyancer is necessary when it comes to staircasing. Be prepared for legal fees associated with their services, these will include things like:
- A legal fee for doing the work - around £300 to £500
- A fee to calculate Stamp Duty costs and handle submissions to HMRC (if necessary) - around £100
- A fee to make a bank transfer to the Housing Association - around £50
- A fee to handle the mortgage paperwork - between £150 and £300
- ID handling for KYC if you're a new client- £25
- Searches with the Land Registry - £3 per search
- Other admin costs - between £50 and £200
In total you’ll be spending between £750 and £1,200 for staircasing, depending on whether you are getting a mortgage for it or not. It’s key to find a good solicitor who knows how staircasing works to make sure that you don’t find unexpected fees. Here is a guide to finding a good Shared Ownershup solicitor.
Mortgage Fees
If you require a mortgage to finance the additional shares, there may be fees involved for using a mortgage broker. These can include arrangement fees, valuation fees, and potential early repayment charges. It's important to thoroughly review the terms and conditions of your mortgage agreement.
Fees really vary broker by broker, with some charging as little as nothing and others charging all the way up to £1,000.
Stairpay deal: Stairpay is partnered with Tembo Money, so all customers that come from us get 50% off their fees. For more information and to apply for a mortgage with Tembo click here.
Housing Association Admin Fees
The Housing Association may charge administrative fees for processing your staircasing application. These fees can vary between different Housing Associations, so it's crucial to inquire about the specific costs involved.
We have seen fees range from zero to £400 for staircasing. Make sure you check your landlord’s website to avoid any unexpected fees.
Stamp Duty Costs
When staircasing, you may be subject to Stamp Duty Land Tax (SDLT) on the portion of the property you are purchasing. However, the exact amount depends on the property value and the prevailing SDLT rates at the time.
The easiest way to find out whether you’ll have to pay Stamp Duty is to use our Stamp Duty Calculator.
Don’t take our word for it
According to our research it will cost you on average around £2,000 in fees to staircase, plus you may have to pay Stamp Duty on top of that. However, your situation may be unique so please make sure you have carried out your own independent research.
We can advise you to get a quote from all the various parties involved, the Housing Association, your solicitor, your mortgage broker, your surveyor and to use our Stamp Duty calculator before applying to staircase, to make sure that you do not get caught shorthanded.
