Please forgive my lack of knowledge here... but what are the potential risks of not having the FSCS protection? If WayHome suddenly go bust, what does that mean for me as a co-owner of the property?!
You failed to address that it`s a very expensive way to own a home, for example, you need to pay all the expenses as you buy more shares of the property as per the proportion that you own. we need to pay additional 3% stamp duty as you are investing with investors (no first-time buyer exempt). Also after you buy your 40% share if you decided to go for the mortgage you will have to pay the stamp duty again so you will pay double tax. And you buy more shares at the market price at the time of you buying the share, not at the purchase price. On average UK house prices go up around 10% every year so it becomes harder to buy more shares. My view is if you have no option to go for an Islamic mortgage this may be a solution, but not very convincing. I would suggest way home to review their product such as sticking to the initially agreed/purchase price of the property instead of the market price since they are getting rent on the proportion that they own which is much higher than what you pay on Islamic Mortgage and not to burden the stamp duty to the customer.
I appreciate your content but I feel it is more focused around UK only without some Global options for Muslims outside of UK. I would appreciate spotting more light on products accessible for Muslims in EU and other parts of the world
The main issue with WayHome is price of the house is not locked. So you actually do not own the house and the price may vary each year. We already had a chat with them last week and it only looks good on paper but at the end of the day it’s like renting with the hope that someday you may be the owner of the house if Allah wants.
Yes but if you want to buy you buy at market value not the actual cost, rent will be increased accordingly. Better to buy small properties in cheap areas and then mature your investment at the time of time when you think this is a tight move for you.
Salaam Alaykum MashaALLAH Jzk for this it was one of the things i was looking for. The questions i have is that im looking into dealpackaging for property investors do you know any brokers that have sharia compliant access to finance their property investment journey?
Some make objections that rent work out based on inflation rate(set by conventional bank) /market rate which is actually an 'interest' so it is actually an 'interest' given another name?
Aslaamu alaikum, please could you do a review on StrideUp. I'm currently looking into this and im confused if it is truly 'halal' way to purchase via their shared ownership scheme.
Can you use your savings from a lifetime ISA to buy a house (or a share/deposit of a house) with wayhome? Will you be able to use the 25% government bonus also? Thanks.
The concept is Islamic but if islamic finance was their only motive, surly a Murabaha mortgage would be more appropriate and fair for buyers. The problem is there no way for the investors to have their cake and eat it too, hence why they don’t offer this option. Someone correct me if I’m wrong but I can say I’ve never seen anyone offering this option, if someone has, please let me know. Jkh
I wish this was true friend. It's very hard here in the UK, especially on a single income. I feel the USA has way better support. The UK govt just pulled the 5% down option from the general public with no plans to put in another opportunity.
I have one question please. If I decide to go through with WayHome, and after 20 years I have acquired 30% of the house and I decide to sell, what happens? will I be able to sell it?
Thank you for the video. It was detailed and informative, jazakAllahu khairan. A quick question, would I be able to do this and not live in the property and rent it out to tenants instead? I realise this would technically be 'sub-letting' but as I would own a portion of the home, would it still be called that? I only ask as I am currently working abroad but will move back to the UK in the next year or so, and so having a home to return to would be so helpful.
Fair - I think the stock is something they'll be improving. On the repayments - yeah they'll defo be more expensive than your average mortgage and Islamic mortgage too.
Hi! 👋 The houses on our website have been vetted by multiple property experts and have been chosen for their relatively lower risk. We have to make sure you and our funding partners are putting your money into good homes with less risk of going down in value. The houses you see are based on your income, your deposit, and the area you're looking in so that might be why you're only seeing 1 and 2 beds. We do have 3, 4, and the occasional 5 bed homes on the site but it really is a fine balancing act. Location-wise, we're launching in lots of areas but we're not yet serving the whole of the country. We hope that'll change as we grow. Lastly, the rents are based on a fair market rent, minus your deposit percentage. So if you buy 5%, and the home usually rents for £1,000, you'll only pay £950 (95%).
If I decide to sell it after paying about 40% means I will get all my money back and of course profit because of increase in value. Is it a good investment?
You cannot own more than 40% due to a tax law and therefore going beyond could end up being expensive for the buyer. However, getting a mortgage for the remainder 60% would surely put people in a better position with potentially having low rates. However at that point, what is the best route for obtaining an Islamic mortgage considering the reviews of Al Rayans process and would lenders be comfortable in lending with such a scheme without T&Cs?! It's a fairly new product which on paper looks great and without an actual house being sold as of yet (confirmed by Wayhome), interesting to see if the process is straightforward! What I'd like to see are some worked examples to illustrate how much someone could benefit or be worse off by using the product. Also if you decide to sell, what value do you get? Can someone save through the Lifetime ISA and use the funds for the deposit?
Hi 👋 you're right, because of existing tax laws we can only help people buy the first 40% of a home they love. We've had several offers on homes accepted so our first homeowners will be moving into their new homes this year! We take on all the headache of solicitors and deciphering property surveys, so it should be much more straightforward than buying a property on your own. If you decide to sell and let's say you own 20% of the home, you'll get 20% of the sale proceeds minus your share of solicitors costs etc. Unfortunately, you can't use a Lifetime ISA to save for the deposit. Answering whether we'll be a 'better' option is difficult to know and certainly not our place to advise. The question you might want to ask and find out is what kind of home will each financial method get you. If traditional methods make you sacrifice too much, you might want to consider alternatives.
Salam IFG, Thank you for this very informative video. My husband and I are considering Wayhome as a method to purchase our first home inshAllah - but before we do I would highly appreciate if you can comment on the below areas; - As first time buyer purchasing with Wayhome - will this method of purchase allow us to benefit from Stamp duty exemption? - As we gradually increase our ownership of equity on the property by 5% each year, will that be treated as a separate purchase by HMRC and have to pay stamp duty on the full value of the property? - If we eventually decide to buy the property outright, will this also be treated as a separate purchase by HMRC and have to pay stamp duty on the full value of the property? Many thanks for your time spent answering the above questions. Regards, Latifa
I am sure IFG will not answer this question since they work more favor to their client This is the main problem that I have with their product. yes, you will have to pay stamp duty regardless of you are a first-time buyer or not. not only that since you're investing with an investment partner you will have to pay additional 3% stamp duty. (Initially, if you buy 5% you only pay the stamp duty but when you buy more shares you will have to keep paying the stamp duty to them as per your proportion). Not only this at any point when you decided to buy a full portion of the share or if you decided to go for the mortgage you will have to pay the stamp duty again because this will be treated as a new purchase. In the end, you end up paying double tax + 3%. Also, bear in mind that as per the market rate property price every year your property price will increase/decrease. (I never heard that UK house price decrease) so it becomes harder and harder to buy more shares.
@@hafsanazaar2679 can you guide me here so per your reply if i understood you correctly about paying tax twice so that's mean a property which value is 360k has a stamp duty £18800 so if i put 10 percent i pay 1800 but gradually when i will acquired 40% so by the time i have already paid 40 percent of stamp duty too which makes 7500 and when i go to buy rest of 60 percent so you saying i need to pay another 18800 because hmrc consider this a new transaction?
Just to clarify… max ownership via wayhome is 39.99%? After this would one need to get a mortgage with another vendor (eg Islamic or conventional) or do wayhome offer mortgages too?
Wayhome don't offer mortgages, you can just continue living in the property for as long as you want and pay rent on the remaining, or you can sell it, or you can get an Islamic mortgage on it to get the rest.
@@IFGuru if you can’t exceed 40% then what’s the point of going with Wayhome? At the 40% mark you’d have to then go for Rayan bank (which many deem haram)?
Hi 👋 The properties you see are the result of filtering the entire market for low-risk property investments, then matching them to you based on your income, your deposit, and the area you're looking in. We need to make sure that we only help you (and our funding partners) invest in good homes with a good track record. And, that the financial arrangement works for both you and them.
@@Wayhome_UK Can you please clarify if the stamp duty is waived as part of the first time buyer. Also, when buying more chunks of share, do you calculate it from the initial price or the current price at the time of buying the share?
Hi @@waqasmahmood_uk 👋 you don't get first-time buyer's Stamp Duty relief because you're buying in partnership with our funding partners (who own all of the other properties we buy). However, you do only have to pay your share of these costs, which is based on how much of the home you buy. For example, if you buy 5% of a home, you would only pay 5% of the Stamp Duty. The same principle applies for other costs such as legal or survey fees. When it comes to buying more of your home, it's calculated based on the current price of the property and not the price when you initially bought it. It's also worthing know that you can buy more of your home from just £50, and we don't charge you any fees for doing this. 🙂
what about the fact it's two contracts in one? meaning a renting contract and buying contract which we know is haram in Islam. also can you name the scholars or the institutes that said this is halal please?
I was looking into wayhome and this is the first thing that stuck in my head. Thanks for asking the question as it means I'm not alone in my thoughts. I hope a clear answer is provided
@@Umm_aniah I've read about every way you can buy a house and I've yet to find a halal way unfortunately. This system is not new it's implemented in Egypt as I've read and it's not halal, may Allah guide us all
Primarily through the rent the homebuyer pays. They may also share in the upside if you make a profit from the house naturally given you are partners. FAQs on Wayhome will have more info
No. Their terms and conditions say you can change decor but not refit kitchen bathroom or add extensions. This will raise the value of the home and make it more difficult for you to purchase more shares of the home as the house will increase in value
@@mohammedali-rh7cq I totally agree with you. I'm just going by what they have stated as wayhome was an avenue was considering. They charge Market value for additional shares so a 5k kitchen can add a great more ££ when it comes to future valuations. I know in other systems if you can show costs put in they discount that expenditure from the market value. Not sure why wayhome don't do it.
It's great to see new innovative products like this in the market place.
@@islamicfinancegrur5472 why 🤔
Please forgive my lack of knowledge here... but what are the potential risks of not having the FSCS protection? If WayHome suddenly go bust, what does that mean for me as a co-owner of the property?!
Great analysis by Ibrahim. Will share on my whatsapp groups.
Great work by IFG may Allah swt bless there efforts
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Such a great video, thank you for sharing
You failed to address that it`s a very expensive way to own a home, for example, you need to pay all the expenses as you buy more shares of the property as per the proportion that you own. we need to pay additional 3% stamp duty as you are investing with investors (no first-time buyer exempt). Also after you buy your 40% share if you decided to go for the mortgage you will have to pay the stamp duty again so you will pay double tax.
And you buy more shares at the market price at the time of you buying the share, not at the purchase price. On average UK house prices go up around 10% every year so it becomes harder to buy more shares.
My view is if you have no option to go for an Islamic mortgage this may be a solution, but not very convincing. I would suggest way home to review their product such as sticking to the initially agreed/purchase price of the property instead of the market price since they are getting rent on the proportion that they own which is much higher than what you pay on Islamic Mortgage and not to burden the stamp duty to the customer.
very helpful information, no one like to like share their weekness.
Isn’t this the islamic way to buy as no interest in involved
I appreciate your content but I feel it is more focused around UK only without some Global options for Muslims outside of UK. I would appreciate spotting more light on products accessible for Muslims in EU and other parts of the world
USA as well please!
The main issue with WayHome is price of the house is not locked. So you actually do not own the house and the price may vary each year. We already had a chat with them last week and it only looks good on paper but at the end of the day it’s like renting with the hope that someday you may be the owner of the house if Allah wants.
Yes but if you want to buy you buy at market value not the actual cost, rent will be increased accordingly. Better to buy small properties in cheap areas and then mature your investment at the time of time when you think this is a tight move for you.
Thank you brother
Salaam Alaykum MashaALLAH Jzk for this it was one of the things i was looking for. The questions i have is that im looking into dealpackaging for property investors do you know any brokers that have sharia compliant access to finance their property investment journey?
In which way are they similar /different to "primary finance"?
Some make objections that rent work out based on inflation rate(set by conventional bank) /market rate which is actually an 'interest' so it is actually an 'interest' given another name?
Aslaamu alaikum, please could you do a review on StrideUp. I'm currently looking into this and im confused if it is truly 'halal' way to purchase via their shared ownership scheme.
Is there risk sharing with this model and how does repossession work?
I like the idea but I need to understand it better. It reminds me of PCP of cars
Can you use your savings from a lifetime ISA to buy a house (or a share/deposit of a house) with wayhome? Will you be able to use the 25% government bonus also? Thanks.
The concept is Islamic but if islamic finance was their only motive, surly a Murabaha mortgage would be more appropriate and fair for buyers. The problem is there no way for the investors to have their cake and eat it too, hence why they don’t offer this option. Someone correct me if I’m wrong but I can say I’ve never seen anyone offering this option, if someone has, please let me know. Jkh
You guys have so many options in the UK. There isn't much in Canada at all.
I wish this was true friend. It's very hard here in the UK, especially on a single income. I feel the USA has way better support. The UK govt just pulled the 5% down option from the general public with no plans to put in another opportunity.
very interesting
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Do they scour the auction properties?
I have one question please. If I decide to go through with WayHome, and after 20 years I have acquired 30% of the house and I decide to sell, what happens? will I be able to sell it?
Thank you for the video. It was detailed and informative, jazakAllahu khairan. A quick question, would I be able to do this and not live in the property and rent it out to tenants instead? I realise this would technically be 'sub-letting' but as I would own a portion of the home, would it still be called that? I only ask as I am currently working abroad but will move back to the UK in the next year or so, and so having a home to return to would be so helpful.
No you can't rent out i am in process of buying home through wayhome and had asked this question to them and they strictly said no
how did it go ? Did you buy your house through wayhome
Promising idea but the housing stock on Wayhome is really poor. Mostly 1 or 2 beds outside London. Plus the repayments at £1300/1400 are quite high.
Fair - I think the stock is something they'll be improving.
On the repayments - yeah they'll defo be more expensive than your average mortgage and Islamic mortgage too.
Hi! 👋 The houses on our website have been vetted by multiple property experts and have been chosen for their relatively lower risk. We have to make sure you and our funding partners are putting your money into good homes with less risk of going down in value.
The houses you see are based on your income, your deposit, and the area you're looking in so that might be why you're only seeing 1 and 2 beds. We do have 3, 4, and the occasional 5 bed homes on the site but it really is a fine balancing act.
Location-wise, we're launching in lots of areas but we're not yet serving the whole of the country. We hope that'll change as we grow.
Lastly, the rents are based on a fair market rent, minus your deposit percentage. So if you buy 5%, and the home usually rents for £1,000, you'll only pay £950 (95%).
@@Wayhome_UK sounds good - wish you all the best guys, great initiative!
Assalamu alkum
Is it possible to invest in WayHome Properties?
at 1:14 awrah is showing u should edit it out
If I decide to sell it after paying about 40% means I will get all my money back and of course profit because of increase in value. Is it a good investment?
Can u make a video for n Helyo plz
Is it accurate to say: you don't gain equity with the "rent" payments?
And "buying" The 5% is separate to the rent payments?
yes rent is just rent. If you want to buy you do that separately.
@@IFGuru Think there needs to be an emphasis on this point. As some would misunderstand that rent and buying is compeltely separate.
With the inflation atm and the house prices, it's sounds like a scam, and no protection. And they say nothing about the initial rent.
Do we have any facilities in India ?
You cannot own more than 40% due to a tax law and therefore going beyond could end up being expensive for the buyer. However, getting a mortgage for the remainder 60% would surely put people in a better position with potentially having low rates. However at that point, what is the best route for obtaining an Islamic mortgage considering the reviews of Al Rayans process and would lenders be comfortable in lending with such a scheme without T&Cs?!
It's a fairly new product which on paper looks great and without an actual house being sold as of yet (confirmed by Wayhome), interesting to see if the process is straightforward! What I'd like to see are some worked examples to illustrate how much someone could benefit or be worse off by using the product. Also if you decide to sell, what value do you get? Can someone save through the Lifetime ISA and use the funds for the deposit?
Hi 👋 you're right, because of existing tax laws we can only help people buy the first 40% of a home they love. We've had several offers on homes accepted so our first homeowners will be moving into their new homes this year!
We take on all the headache of solicitors and deciphering property surveys, so it should be much more straightforward than buying a property on your own.
If you decide to sell and let's say you own 20% of the home, you'll get 20% of the sale proceeds minus your share of solicitors costs etc.
Unfortunately, you can't use a Lifetime ISA to save for the deposit.
Answering whether we'll be a 'better' option is difficult to know and certainly not our place to advise. The question you might want to ask and find out is what kind of home will each financial method get you. If traditional methods make you sacrifice too much, you might want to consider alternatives.
There is no link for your Telegram address?
What are your thoughts of primary finance?
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maximum share is limited to 39.99 is a deal breaker
Salam IFG,
Thank you for this very informative video.
My husband and I are considering Wayhome as a method to purchase our first home inshAllah - but before we do I would highly appreciate if you can comment on the below areas;
- As first time buyer purchasing with Wayhome - will this method of purchase allow us to benefit from Stamp duty exemption?
- As we gradually increase our ownership of equity on the property by 5% each year, will that be treated as a separate purchase by HMRC and have to pay stamp duty on the full value of the property?
- If we eventually decide to buy the property outright, will this also be treated as a separate purchase by HMRC and have to pay stamp duty on the full value of the property?
Many thanks for your time spent answering the above questions.
Regards,
Latifa
No, yes, yes.
I am sure IFG will not answer this question since they work more favor to their client
This is the main problem that I have with their product. yes, you will have to pay stamp duty regardless of you are a first-time buyer or not. not only that since you're investing with an investment partner you will have to pay additional 3% stamp duty. (Initially, if you buy 5% you only pay the stamp duty but when you buy more shares you will have to keep paying the stamp duty to them as per your proportion). Not only this at any point when you decided to buy a full portion of the share or if you decided to go for the mortgage you will have to pay the stamp duty again because this will be treated as a new purchase. In the end, you end up paying double tax + 3%. Also, bear in mind that as per the market rate property price every year your property price will increase/decrease. (I never heard that UK house price decrease) so it becomes harder and harder to buy more shares.
So how did it go and did you buy property through wayhome yet? As i am considering to buy through them any help will be appreciated
@@hafsanazaar2679 can you guide me here so per your reply if i understood you correctly about paying tax twice so that's mean a property which value is 360k has a stamp duty £18800 so if i put 10 percent i pay 1800 but gradually when i will acquired 40% so by the time i have already paid 40 percent of stamp duty too which makes 7500 and when i go to buy rest of 60 percent so you saying i need to pay another 18800 because hmrc consider this a new transaction?
I think this way is only worth it if you want to sell after living in it for a while 🤔
Just to clarify… max ownership via wayhome is 39.99%? After this would one need to get a mortgage with another vendor (eg Islamic or conventional) or do wayhome offer mortgages too?
Wayhome don't offer mortgages, you can just continue living in the property for as long as you want and pay rent on the remaining, or you can sell it, or you can get an Islamic mortgage on it to get the rest.
@@IFGuru if you can’t exceed 40% then what’s the point of going with Wayhome? At the 40% mark you’d have to then go for Rayan bank (which many deem haram)?
CAN you pay the remaining 60% in cash and be the owner of it all?
If we have to get the ‘Islamic mortgage’ after all, what is the point of way home anyway. Why not go with the Islamic mortgage in the first place.
Definitely Islamic mortgage charges you a lot for coveyencing and fees
Can you use this for a property you may want to potentially rent out?
I'm confused, after buying a max of 39.99 you have 2 options..
1. either buy outright,
2. Continue paying (60%)rent.
You cant continue buying chunks?
So you telling me that I should continue with my application form with Wayhome. Is it Halal
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look up double contract in islam. Two contracts in one, renting and buying
Skip to 4:55
Does it allow u to rent out to someone else?
Hi 👋 unfortunately, you can't rent out any part of the property we buy with you.
but you mentioned if I understood it being a partnership and you over time buy up more of the partnership
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Wayhome is a good solution but their property portfolio is quite limited
Hi 👋 The properties you see are the result of filtering the entire market for low-risk property investments, then matching them to you based on your income, your deposit, and the area you're looking in. We need to make sure that we only help you (and our funding partners) invest in good homes with a good track record. And, that the financial arrangement works for both you and them.
@@Wayhome_UK Can you please clarify if the stamp duty is waived as part of the first time buyer. Also, when buying more chunks of share, do you calculate it from the initial price or the current price at the time of buying the share?
Hi @@waqasmahmood_uk 👋 you don't get first-time buyer's Stamp Duty relief because you're buying in partnership with our funding partners (who own all of the other properties we buy). However, you do only have to pay your share of these costs, which is based on how much of the home you buy. For example, if you buy 5% of a home, you would only pay 5% of the Stamp Duty. The same principle applies for other costs such as legal or survey fees.
When it comes to buying more of your home, it's calculated based on the current price of the property and not the price when you initially bought it. It's also worthing know that you can buy more of your home from just £50, and we don't charge you any fees for doing this. 🙂
Heylo no longer take 5% as a deposit. It’s now 25%
Interesting - good Intel
what about the fact it's two contracts in one? meaning a renting contract and buying contract which we know is haram in Islam. also can you name the scholars or the institutes that said this is halal please?
I was looking into wayhome and this is the first thing that stuck in my head. Thanks for asking the question as it means I'm not alone in my thoughts. I hope a clear answer is provided
@@Umm_aniah I've read about every way you can buy a house and I've yet to find a halal way unfortunately. This system is not new it's implemented in Egypt as I've read and it's not halal, may Allah guide us all
@@rudinam2409 Ameen. InshaAllah we will be granted beautiful homes of our own in Jannah
@@Umm_aniah allahuma ameen 🤲
How would investors make money from this?
Primarily through the rent the homebuyer pays. They may also share in the upside if you make a profit from the house naturally given you are partners. FAQs on Wayhome will have more info
You cannot change the aesthetics of the kitchen and bathroom?
No. Their terms and conditions say you can change decor but not refit kitchen bathroom or add extensions. This will raise the value of the home and make it more difficult for you to purchase more shares of the home as the house will increase in value
@@Umm_aniah but you actually paid for the renovation "increase in value" so it doesn't make sense they charge you for that increase
@@mohammedali-rh7cq I totally agree with you. I'm just going by what they have stated as wayhome was an avenue was considering. They charge Market value for additional shares so a 5k kitchen can add a great more ££ when it comes to future valuations. I know in other systems if you can show costs put in they discount that expenditure from the market value. Not sure why wayhome don't do it.
@@Umm_aniah Thank you for claryfying that
@@mohammedali-rh7cq no probs. Thier website FAQs are quite comprehensive so if I've stated anything incorrectly you can always check that out
So do you have to be Muslim?
No