Saturday, May 24, 2008
Gordon's shared equity scam
Spectator: Half a house is hardly worth having
Why is the government trying to buck the housing market at all? Leave it alone and prices will continue their slide. Then, perhaps in a couple of years’ time, first-time buyers will be able to afford to buy themselves entire houses, rather than the half-houses which Gordon is offering them now.
Posted by pendulum @ 09:51 AM (948 views) Add Comment
12 Comments
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1. quiet guy said...
"why is the government trying to buck the housing market at all? Leave it alone and prices will continue their slide. Then, perhaps in a couple of years’ time, first-time buyers will be able to afford to buy themselves entire houses, rather than the half-houses which Gordon is offering them now. I suspect most first-time buyers will be able to work this out for themselves."
In my area, it seems that most new builds are being sold as "shared ownership". Oops - correction - I mean marketed as "shared ownership". Little, if any, seems to be selling.
2. letthemfall said...
It's always comforting when someone points out the bleedin obvious in this Kafkaesque country. Is Gordon Brown a fool, an ignoramus, or a desperate manipulator; or is he collapsing under the stress of it all?
Ironic that a govt so keen on the market should be intervening in this way. Just as well it's a piffling amount; the damage they can do is limited.
3. it_is_going_with_a_bang said...
About time that headline was stuffed down Gordon's trousers and kicked.
Half a house? I've always said it was an insulting gesture from someone who personally allowed the situation to occur in the first place.
Own half of it and rent the other half?
"With the average home costing a little under £200,000, £200 million will buy only 1,000 properties — compared with the 167,000 built last year, many of which remain unsold."
Yes Flash Gordon it really is a complete waste of time and more to the point a £200 million bribe.
"In 2005, it introduced the ‘Social Homebuy’ scheme designed to entice tenants to buy a stake in their homes. By last November only 88 had chosen to do so."
Need anyone say anymore?
4. uncle tom said...
I was talking about this while having my hair cut yesterday. The girl who was doing her best to make my thinning mop look presentable was contemplating buying into a shared equity scheme. Aside from the matter of the housing market collapsing, I pointed out that once into one of these schemes, there are very few options for moving on - there is more than a degree of entrapment.
I advised her to hold fire and keep saving.
5. japanese uncle said...
Anyone with cerebellum is capable of imagining how hard it should be, if a bathroom is shared by more than two people, let alone two families. It may be about time to start calling him 'Flush Gordon'.
6. Bobby9983 said...
£200 million will go a lot further on unsold homes. Unsold homes do not sell for the national average of £200,000, you are talking more like £80,000 as an average for an unsold, especially as most social housing is in the North anyway.
And why does anyone think that the £200 million won't be leveraged? 80% loan to value? Thankyou very much now we have £1 billion and at £80,000 a piece now we can buy 12,500 homes. Then we create a cast iron loan book of £800 million government backed mortgage securities, sprinkle in a bit of Northern Rock sub-prime and et voila we have a very nice, billion pound MBS to flog to the markets.
7. Bobby9983 said...
I don't know why everyone is focusing on this £200 million like it will be spent on houses that are costing the national average of £200,000.
Most unsold empty homes in social housing areas are round my way oop north and can be picked up for around £100,000.
Also, who says the £200 million won't be leveraged? At 80% LTV you'd get £1 billion of property. That's 10,000 homes at £100,000 a piece.
The banks that underwrite this can then package it up, sprinkle in a bit of sub prime (probably from Northern Rock) and then sell it off as a government backed RMBS.
Sounds great eh Gordo?
8. confused76 said...
"Is Gordon Brown a fool, an ignoramus, or a desperate manipulator; or is he collapsing under the stress of it all?"
All of the above + arrogant and pretentious
9. confused76 said...
Flush Gordon:
http://www.youtube.com/watch?v=wNf9rEPoc8Q
Flush... the king of impossible...
10. Stupid_boy_pike said...
So this is the present state of the UK
The populous can only afford to by half a house.
11. a saver said...
confused76 @6, all
GB is a crazed control freak who doesn't know his ass from his elbow
12. indiablue19 said...
Interesting concept. Groups of people marrying mortgages and houses instead of each other. Or maybe in addition to each other. Gives new meaning to the term "house poor."