The Your Home lease allows you to buy a bigger share of the property, using any increased value entitlement to act as a discount on the purchase price of the additional share. Alternatively, if you want to move you just sell your property on the open market. Assuming prices have risen you’ll get all the value increase on your share plus 75% of the increase on the unpurchased share owned by heylo too!
Buying more... Here’s how it works
Imagine you purchased a 10% share of a £200,000 home and would like to buy a further 30%. Since you moved in your property has increased in value to £300,000. Buying a 30% share would be calculated as follows:
30% share of the increased property value would normally cost £90,000 (30% of £300,000) but with the Your Home value entitlement applied as a discount a 30% share would cost just £67,500.
Once you have purchased an additional share your rent would immediately reduce. In this case, as you are purchasing 30% of the remaining 90% your rent would reduce by 1/3rd.
Based on the original £200,000 property price a 30% share was worth £60,000. Given that the value of a 30% share has increased to £90,000 you would be entitled to 75% of the £30,000 value increase - which is applied as a discount. This means that you get £22,500 off the £90,000 share price paying just £67,500.
You can buy more at any time, using cash or cash and a mortgage, however, mortgage availability can vary and may be subject to change.
Moving... Here’s how it works
To ensure you get any value entitlement when you move you will need to sell your property outright - this is done by simultaneously buying the bit you don't own and selling 100% of the property to the buyer you have found.
Imagine that some time after increasing your ownership in the same property to 40% you want to move. After putting the house up for sale, you find a buyer and agree an outright sale at a price of £400,000.
Given your 40% ownership and 75% Your Home value entitlement, on completion of your sale you would be entitled to the following:
The value of your 40% share, which is now worth £160,000, plus the Your Home value entitlement worth £90,000. A total of £250,000.
40% of the £400,000 sale price is £160,000. Based on the original £200,000 property price a 60% share was worth £120,000. Given that the value of a 60% share has increased to £240,000 you would be entitled to 75% of the £120,000 value increase - which is paid from heylo's 60% share proceeds at completion.
It is possible to sell your share but doing so will not entitle you to any value increase (and whilst this value may exist your buyer may not pay you for it).