Sell off state homes at 100% of value

wotsthat

cells wrote: »

That's just saying nobody would take it up which I think is wrong given such a chance I think hundreds of thousand's would take up the option

The current system is better for those who have savings or can get finance as they get upto £100k discounts. However if you can't get finance then this would be a lot better

I do wonder what the average age is of a typical council house dweller - I suspect they're too old to take on a 25 year mortgage.

Also, at some point they've qualified for a council house so much lower quality lending than help to buy for example.

cells

wotsthat wrote: »

I do wonder what the average age is of a typical council house dweller - I suspect they're too old to take on a 25 year mortgage.

Also, at some point they've qualified for a council house so much lower quality lending than help to buy for example.

In this idea I don't think the general mortgage rules and methods need apply because the risk to the government is nil.

Worst case is the buyer defaults and the government gets the house back its not lost or gained anything. All it would lose is maybe a few months of interest payments until they repo and the 5% deposit would cover that. In normal mortgages less than 0.5% default I think it would be the same with this group actually maybe even less as they would be on a stable fixed rate not a variable

No affordability
IO
Any age

The risk is nil so if you are 60 and on a pension and have the 5% deposit you are welcome if you want to do it

Graham_Devon

So with this solution added the government will be...

- Offering discounts on council properties.
- Paying up to 40% on behalf of the buyers in a housing association house.
- Offering Help to Buy
- Running funding for lending
- Offering Support for Mortgage Interest.

And with this idea, they would also be stepping in as a high risk mortgage lender?

And all of this in a free market?

CLAPTON

Graham_Devon wrote: »

So with this solution added the government will be...

- Offering discounts on council properties.
- Paying up to 40% on behalf of the buyers in a housing association house.
- Offering Help to Buy
- Running funding for lending
- Offering Support for Mortgage Interest.

And with this idea, they would also be stepping in as a high risk mortgage lender?

And all of this in a free market?

could you quote anyone either here or in the UK, who believes we have a free market ?

cells

No it would not be a high risk mortgage lender it would be a very close to nil risk mortgage lender and it would be without a discount sold at 100% market price

Lets take an example

Mr & Mrs council tenant want to buy their home

They apply to the council who sends a surveyor who says its a £150,000 house.

The couple give the council the 5% (£7,500) and the council changes ownership of the property to them with a charge of £142,500 on the property and proceeds to charge them 3% interest on the £142,500 = £356 per month

Worse case is that Mrs & Mr former tenants now owners stop paying their £356 per month. If that happens the council will need to repo the home. If the home has gone up in value or stayed the same (99% likely imo) then there is no problem. If the home has gone down in value......well the council gets the very same home back and hasn't lost anything