anyone else see London Tonight programme with the girl who had bought 10%?

CB1979_2

all i caught of it was basically she's a newly graduated (21 years old) recruitment consultant earning £18k a year.

just think it was a way to get on the ladder.

just wanted to know what the set up of it was and how it all works (not cos i'm interested in doing something similar though!)

and at RH - reason i put about you commenting, is that you seem to come across with valid points, allbeit you answer a question with a question?

Mrs_pbradley936

I have a theory on this. The sale of Council housing twenty odd years ago made lots of people home owners that otherwise would have remained renters, and that it turn means fewer houses to rent. Those houses/flats that would have come back into the renting stock following the death of the tenant are now assets to be passed to the heirs. That does two things – it reduces the amount of rented accommodation and it gives lump sums to those that previously may never have had an inheritance. The inheritance adds to the money supply which pushes prices up making market prices out of reach of many. I think that if shared ownership is encouraged then at least people will have some sort of stake in the property albeit small in this particular case. I think the term is “Social Engineering” because if people own something and are upwardly mobile it is better than them owning nothing and the population being divided into the “haves” and “have nots”. History teaches us that giving poor people money does nothing to end poverty. They need to be part of the main stream economy so they can benefit from capital growth.

It is now policy for a percentage of newly built homes to be “affordable”. In parts London that means someone renting or part buying with a Housing Association is living next door to someone who paid £300k for their place. It is thought to be better than
dividing the area into Council estates and yuppy areas.

RHemmings

CB1979 wrote:

allbeit you answer a question with a question?

Too frequently? :j

backtomum

ha ha ha ha ha. If this is true people are getting stupider by the minute. I can't believe that this could be true!!!! Could it?

RHemmings

CB1979 wrote:

and at RH - reason i put about you commenting, is that you seem to come across with valid points, allbeit you answer a question with a question?

I had a think about things. Personally I haven't looked at shared ownership in great detail. Once I got a few quotes, but the prices for the properties were so high that even the 50% figure seemed high. More recently I did look at some properties being sold 100%, where some other properties in the development were SO. Out of curiosity I asked for the details of the SO properties. The prices were half asking. High, but not absolutely outrageous prices. And the amount of rent did seem a reasonable amount. After that, while I wasn't interested myself, I thought that the SO wasn't too bad a deal. But then I read questions from someone, I can't remember where, who had a SO flat as that was all he could afford. He complained that the HA had increased both his rent, and his service charge by considerable amounts. His council tax had gone up a lot too. And the result was that he couldn't meet his obligations, and was probably going to lose the flat. That really scared me. It makes me think that home part-owners are at the mercy of the housing association that owns the remainder of their properties. Even if there's some sort of law controlling how much rent and service charges can go up, the home part-owner seems to have limited control over the situation. If they're right on the financial limit, then they could be pushed over. And if they want to sell their share of the property, I'd imagine that the cost of the rent and the service charge will have an effect on what they can sell the property for. So if the charges go up, it might reduce what they can get for the property.

I really don't want to get into situations where I have no control over what happens to me. So SO is something that I will be avoiding touching with a very long bargepole.

Mrs_pbradley936

This site has an article on the economics of housing

http://www.spiked-online.com/index.php?/site/article/1647/

lynzpower

IN response to Rhemmings

I can't remember where, who had a SO flat as that was all he could afford. He complained that the HA had increased both his rent, and his service charge by considerable amounts. His council tax had gone up a lot too. And the result was that he couldn't meet his obligations, and was probably going to lose the flat. That really scared me. It makes me think that home part-owners are at the mercy of the housing association that owns the remainder of their properties.

Just to give you a bit of an idea as to how it works with my HA.
The HA state that they will put up the rent, in line with inflation only, annually, on October the 20th. Yesterday In fact I recieved my letter as to how much the rent is rising. Its going up by 9.48 per month, and that includes the service charge and any increase to that as well.

There is a world of difference in "what one can afford" On one hand its what a person would be mortgaged for ( ie I oculd be mortgaged less than 80k as a single person) and what is affordability once debts, running costs and living cost are taken into account. We as avid MSers know this difference.

Everyones council tax goes up, whether your renting or your in SO or you are able to buy outright.

Lots of us are up against it, be it from rising council tax, mortgage interest rates, electricity bills, childcare increases. I certainly dont think a tenner a month is unreasonable, im sure he would have had this increase wherever he would be living.

RHemmings

lynzpower wrote:

Just to give you a bit of an idea as to how it works with my HA.
The HA state that they will put up the rent, in line with inflation only, annually, on October the 20th. Yesterday In fact I recieved my letter as to how much the rent is rising. Its going up by 9.48 per month, and that includes the service charge and any increase to that as well.

There is a world of difference in "what one can afford" On one hand its what a person would be mortgaged for ( ie I oculd be mortgaged less than 80k as a single person) and what is affordability once debts, running costs and living cost are taken into account. We as avid MSers know this difference.

Everyones council tax goes up, whether your renting or your in SO or you are able to buy outright.

Lots of us are up against it, be it from rising council tax, mortgage interest rates, electricity bills, childcare increases. I certainly dont think a tenner a month is unreasonable, im sure he would have had this increase wherever he would be living.

Putting the rent up in line with inflation sounds reasonable. I'm retrieving details from my memory and could easily be wrong, but I think the person I read about had their rent and service charge go up something like 30% in a few years. And their salary either hadn't gone up or had gone down. It may be an extreme case, but it really put me off even thinking about SO.

Does your HA put up the rent in line with the CPI? That would be a good deal as real inflation might be quite a bit higher.

lynzpower

remind me what CPI stands for - its late

noyk

not late enough - consumer price index