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Councillors Stop Developer Dropping House Prices By £20,000

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all sounds very complex.

Might be interesting to know who has fingers in which pies.

Is there an equivalent of members interests for councils?

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Councillors must have bought some of the flats...

EDITED :

http://www.rightmove.co.uk/property-for-sa...ts%26index%3D10

They are 60% shared equity retirement flats! Weird, and very very over priced in comparison to competition.

Three have sold

http://www.houseprices.co.uk/e.php?q=PL15+9DR

for £179, £249 and £249

Looks like the 179k is a 1BR, the 249k is a 2BR. The 249ks sold on teh same day so I assume they went to a single investor

Developer has already dropped the price of the 100% property by 10k

http://www.rightmove.co.uk/property-for-sa...ts&index=20

But they have kept the 2BR at a eye watering 249k

http://www.rightmove.co.uk/property-for-sa...ts&index=30

Edited by moosetea

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Guest sillybear2
(Your title needs an extra zero)

Lord Levy said to a Labour donor...

Edited by sillybear2

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Councillors must have bought some of the flats...

EDITED :

http://www.rightmove.co.uk/property-for-sa...ts%26index%3D10

They are shared equity retirement flats! Weird!

Sounds like there is a subsidy involved, and it will cost the Council more if the price is dropped unless the full drop in borne by the developer...

This is why we learn every cycle, the less the public sector get involved the better, it always ends in tears, be it infrastructure, Domes, Olympics, IT.....

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Guest sillybear2
Sounds like there is a subsidy involved, and it will cost the Council more if the price is dropped unless the full drop in borne by the developer...

This is why we learn every cycle, the less the public sector get involved the better, it always ends in tears, be it infrastructure, Domes, Olympics, IT.....

Lower sales price = less money to be shared with the "affordable housing" quango... and they need money to make houses affordable! So in order to make housing affordable they need high house prices and big profits, lower sales prices work against their interests. Through the looking glass, eh?

Edited by sillybear2

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There is no conspiracy.

The developers want to cut the price of the affordable homes by £20k but in return they want to reduce the number of affordable homes in the development from 11 down to 7. In other words, the developer wants to offset the loss of revenue on the affordable homes by selling the 4 that will no longer be affordable homes at a higher price (i.e as normal homes).

The council have not prevented the developer form cutting prices - they have refused to let them offset their loss by reducing the number of affordable homes.

This bit of the article explains the decision.

Alex Child, director of the Planning Bureau, McCarthy and Stone's planning agents, said: "The element of affordable housing is essentially an agreed subsidy from the overall development. In this market, to make the affordable housing truly affordable, the sale prices of them need to reduce but this means the income to both the developer and the affordable housing provider also reduces.

"To compensate for this, we asked the council to consider less units being subsidised as affordable housing as in our view it would be wrong for the agreed subsidy to effectively be increased by the reduced sales prices required."The important thing is to reach an agreement so that these properties can be properly managed and do not remain vacant. That helps no one."

Bottom line is that it seems the council has concluded the developer needs to cut prices because retirees cannot sell their own home but the developer should take the hit on its profits. I agree with the council.

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McCarthy and Stone build retirement flats for over 55's. Maybe there isn't a need for affordable housing for pensioners in this area. Most 55+ year olds who wanted to own a house would surely have bought one 20+ years ago. They would probably trade down to these flats and stick the balance of their house sale in the bank etc. Anybody who is 55+ and is on a low income who might be eligible for the "affordable" homes would need to have a decent deposit AND be able to clear the mortgage within 10 years. Sounds like a catch 22 situation - if you can pay cash you buy the full price flats. If you are poor you cannot buy the affordable flats because you don't earn enough to cover a 10 year mortgage! Normally McCarthy and Stone wouldn't do affordable housing, but they are forced by housing policy to supply a percentage of affordable housing. I think the only way they could sell these is to sell them to a housing association and for the association to rent them out to people who have never owned a house before.

McCarthy and Stone are always very expensive. It's not just the purchase price - you should have a look at their monthly maintenance charges!

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Alex Child, director of the Planning Bureau, McCarthy and Stone's planning agents, said: "The element of affordable housing is essentially an agreed subsidy from the overall development. In this market, to make the affordable housing truly affordable, the sale prices of them need to reduce but this means the income to both the developer and the affordable housing provider also reduces.

"To compensate for this, we asked the council to consider less units being subsidised as affordable housing as in our view it would be wrong for the agreed subsidy to effectively be increased by the reduced sales prices required.

is it me or is this really saying - to make houses affordable we need to make them expensive, because lower prices makes them more expensive that making them cheaper or more expensive. :blink:

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is it me or is this really saying - to make houses affordable we need to make them expensive, because lower prices makes them more expensive that making them cheaper or more expensive. :blink:

Thanks. That's just melted my brain. :blink:

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Guest sillybear2
is it me or is this really saying - to make houses affordable we need to make them expensive, because lower prices makes them more expensive that making them cheaper or more expensive. :blink:

Great minds think alike!

:wacko:

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Guest happy?
There is no conspiracy.

The developers want to cut the price of the affordable homes by £20k but in return they want to reduce the number of affordable homes in the development from 11 down to 7. In other words, the developer wants to offset the loss of revenue on the affordable homes by selling the 4 that will no longer be affordable homes at a higher price (i.e as normal homes).

....

Huge spin from McCarthy and Stone's publicity department trying to shift responsibility onto the council. The planning permission was given on the basis that M&S would sell 11 properties as affordable homes, now that their market's gone south they expect the local taxpayer to subsidise their business for them.

Half the posters on this site are so far up their own backsides regarding councils that they failed to spot the wool being pulled over their eyes by marketing spin.

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The story has been couched in a different way but the key is that M&S want to drop the number of affordable units from 11 to 7 in order to be able to drop the price of the main units and still turn a profit, but the council won't let them do this.

Builder told: 'You can't sell homes cheaper'

In order to get this through M&S were willing to drop the affordable prices down from £123k to £99k, so losing a notional £168k on the 7 units. 19.5% drop.

The council look to have this nailed, M&S don't want to compromise on their profit. Though with "30 viewings – but not a single sale" they seem to be living in cloud cuckoo land. This will have an "interesting" effect on local statistics when M&S finally realise they won't sell 32 apartments at their target price, so drop them by at least 20% which will then allow the retirees to sell their properties at 20%, and so on.

As this will be repeated nationwide a 20% drop this year begins to look a big underestimate.

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  • 284 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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