If you meet the Participating Bank’s lending requirements and can contribute a minimum of 5% of the purchase price, you can apply to Ngāti Whātua Ōrākei Whai Rawa for assistance through the shared ownership scheme.
Shared ownership is where Ngāti Whātua Ōrākei Whai Rawa will contribute towards the initial purchase price of your home (up to 25%) and own the corresponding share of the home to start with, which you agree to buy out overtime.
The banks will talk with you about whether this is an option for you and direct you to Whai Rawa. To apply for shared ownership, you will need to have a kōrero with an independent financial adviser engaged by Whai Rawa to check your eligibility. The offer of shared ownership is entirely at the discretion of Whai Rawa.
You must use your own financial resources in buying a home before being offered shared ownership by Ngāti Whātua Ōrākei Whai Rawa.
If you have a 10% purchase price and a participating bank is willing to lend you 75%, Ngāti Whātua Ōrākei Whai Rawa then contributes 15% to purchase the home with you in return for a
15% share of ownership in the home.
How does it work?
If you are offered shared ownership, you will enter into a shared ownership agreement with Ngāti Whātua Ōrākei Whai Rawa. You will agree to use best endeavours to buy Ngāti Whātua Ōrākei
Whai Rawa out within the first 30 years of ownership or the term of the mortgage, if shorter. The value of the share owned by Ngāti Whātua Ōrākei, is determined by the market value of the
home at the time of the buy out.
If the value of the home is increased by 10% at the time you buy out Ngāti Whātua Ōrākei, the share owned by Whai Rawa will cost 10% more to purchase. You can agree to buy Ngāti Whātua
Ōrākei out in instalments.
With shared ownership, you will still be entirely responsible for your mortgage and all the costs of your home (such as maintenance, insurance, rates).
Shared Ownership Agreement
If you are accepted as part of the shared ownership scheme, the Shared Ownership Agreement is the agreement you sign with Ngāti Whātua Ōrākei Housing Trustee Limited (for the Sister Trust to the Ngāti Whātua Ōrākei Housing Trust that administers the shared ownership scheme). The goal is for you to eventually purchase the Sister Trust’s full share (within 30 years or the term of the mortgage, if shorter) while occupying the home as a co-owner until purchasing the full share is achieved. The Shared Ownership Agreement sets out terms and conditions for co-ownership.
There is no interest applied to shared ownership portion that Whai Rawa contributes but it’s important to note that if Whai Rawa contributes $100,000 on a $1,000,000 property which is 10% of the value then that same percentage will apply when you go to buy Whai Rawa out. For example if the whare increases in value to $1,200,000 then you will need to pay $120,000 to buy Whai Rawa out.
When you talk with the bank, they will assess what you can afford. If you require Shared Ownership, they will ask you to sign consent for Whai Rawa to access your info to assess your eligibility for Shared Ownership. Once our independent financial advisor has assessed your info, they will confirm with you and the bank whether you are eligible and for how much.
The first anniversary of the end of the mortgage (or 30 years) is the deadline to buy out Whai Rawa. The legal agreement states that you will use your ‘best endeavours’ prior to that time.
You can pay off earlier and in instalments. The first anniversary of the end of the mortgage (or 30 years) is just the deadline to buy out Whai Rawa. The legal agreement will say that you will use your ‘best endeavours’ prior to that time.
There will be an annual process:
There will be a minimum amount that can be paid as an instalment – we have not set that amount yet.