Property: Home Truths
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Due to my recent retirement, my wife and I are now able to afford having our dream home built. What are the pros and cons of having your home built for you?
C Wright, Plymouth
The great advantage of building your own home is that you are able to create something that suits your every requirement. It can also allow you to convert a non-residential property, such as a barn. One drawback is that it can be difficult to gain planning permission. You will also need to keep a regular check of the costs you are incurring as it can be very easy to exceed your budget.
Fishing rights
I am a keen angler and intend to buy a house that has a river at the bottom of the garden. Will I legally be able to fish from the bottom of my garden?
P Harrison, Stratford-upon-Avon
Normally, you will own the river bed up to the middle of the river if your property backs on to or faces the river. Under common law, the owner of the river is also presumed to own the right to fish. However, you will need to ask your solicitor to check that the fishing rights of the property have not been sold to a third party. If you do own the rights to fish, you will still need an Environment Agency fishing licence.
On deposit
Can you tell me what a Deposit Guarantee Scheme is? My solicitor has suggested that this is better than paying a deposit.
D Ryan, Bath
When you exchange contracts on a purchase of residential property it is normal to pay a deposit of 10 per cent. The Deposit Guarantee Scheme is an insurance policy designed to remove the need for a cash deposit and is paid for by those buying the property. The seller receives a guarantee instead of a cash deposit.
The insurance company will compensate the seller if you default under the contract. You can also get similar policies where the guarantee can be passed along a chain of property transactions.
Shared ownership
I recently read an advertisement in the press which emphasised the advantages of "shared ownership". How does this work?
B Kearny, Manchester
Shared ownership is an option for people who cannot afford a property on their current salary. A housing association allows you to buy a percentage of the property - the minimum is usually either 25 or 50 per cent - and retains the remaining share of the property. You take out a mortgage for the percentage of the property you are buying and pay rent to the housing association for the part it owns. There are usually other costs, so you must make sure you understand the full amount you will be paying each month.
If your income increases, you may have the option of increasing your share in the property. Not all lenders offer mortgages for shared ownership and those that do have differing lending guidelines. If you are considering entering into a shared ownership agreement, I would suggest you seek advice from a qualified financial adviser.
q George Wise is managing director of NatWest UK Mortgage Services.
q Send your queries on practical property issues to the following address: Home Truths, Travel & Money, Independent on Sunday, 1 Canada Square, Canary Wharf, London E14 5DL, fax: 0171-293 2043; e- mail: sundayproperty@independent.co.uk
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