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Boris Johnson To Approve ‘Affordable’ London Flats For Rent At Up To £2,800

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Boris Johnson is set to approve plans for “affordable” flats that the Guardian understands could cost tenants up to £2,800 a month to rent.

The London mayor is expected to grant consent on Friday for the construction of 98 “affordable rent” apartments on the site of the Royal Mail’s Mount Pleasant sorting office in central London in a deal that critics say makes a mockery of the idea that affordable housing is for the most needy.

Confidential estimates of market rents filed as part of the application suggest tenants could be charged up to £1,170 a month for a one-bedroom flat and up to £1,690 for a two-bedroom flat. A family occupying a four-bedroom flat in the development could be asked to pay as much as £660 a week. According to a rule of thumb widely used by housing experts that housing costs should represent a third of income to be considered affordable, their family income would need to be around £100,000.

Sarah Hayward, the leader of the London borough of Camden, said the expected rents on the Mount Pleasant scheme were among the highest ever seen for affordable housing.

“If these rent levels are as claimed, they will not be in any way affordable,” the Labour councillor said. “Boris Johnson is showing his true colours. He doesn’t want poor people living in London.” [more at link]

http://www.theguardian.com/society/2014/oct/02/boris-johnson-approve-affordable-london-flats-rent

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“Boris Johnson is showing his true colours. He doesn’t want poor people living in London.”

That's why the NIMBY's don;t want new housing near them. They don't want poor/regular people living in their towns and villages.

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£2800 after tax , what's that about 4K before tax, so you need to earn £48K a year just to pay your rent.

£48K going to a BTL landlord subsidies by the poors taxes.

These people should be locked up for what they are going.

Edited by TheCountOfNowhere

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“Boris Johnson is showing his true colours. He doesn’t want poor people living in London.”

Bit it's not just the "poor people" these days is it.

It hasn't been just the poor people for a long time.

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That's why the NIMBY's don;t want new housing near them. They don't want poor/regular people living in their towns and villages.

Those poor/ regular people tend to be on the young side too. Just like those NIMBYS used to be when they bought cheap housing.

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£2800 after tax , what's that about 4K before tax, so you need to earn £48K a year just to pay your rent.

£48K going to a BTL landlord subsidies by the poors taxes.

These people should be locked up for what they are going.

Something like this would lead me to suspect that the developer is either one of johnsons's chums or a Tory donor. Or maybe they are just so detached from reality they think that they are affordable rents? Surely he can't be that oblivious, he is undoubtedly quite smart, or maybe he really is just an evil little pr1ck like his cousins Osborne and Cameron.

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Boris has always been evil. Wasn't he recorded threatening to have someone beaten up a few years ago. It's incredible how many naive people can't see through his foppish clown play-act when he is actually a nasty, manipulative ba$tard, a true Tory in every cliched sense. London was better under Livingstone and that's saying something.

Edited by fru-gal

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The London mayor is expected to grant consent on Friday for the construction of 98 “affordable rent” apartments on the site of the Royal Mail’s Mount Pleasant sorting office in central London..

They're making such a big thing about such a tiny number. It's not exactly a new town or a new Garden city is it. It's dribs and drabs.

So what the London Mayor grants it consent - big deal. Is it the reason for a big jollie or something then.

Announcing the 98 new apartments in London must be because neither Cameron nor Osborne said anything about the numbers of new homes they're going to build per year if they're elected. Never mind how many between now and the election. If they're (rightly) criticising Milliband for not mentioning the deficit they're just as open to criticism for not mentioning new home numbers.

It's like - 98 mate. That's your lot.

How about getting a move on and getting the rest built and finished and the sooner the better - and getting some more in the pipeline.

Edited by billybong

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Just a thought, when I see the term "affordable" used in connection with housing I automatically assume that it certainly isn't "affordable", at least by anyone with a sane view of personal finance.

Consider that the we do not use the term "affordable" in connection with any other asset or product in commerce one has to be immediately suspicious of it's use in this context. I see it as a red flag indicator when dealing with deception or obscurification, particularly when used in certain ways, a similar example would be the old west and it's snake oil salesmen or other fraudsters and charlatans who would roll around in wagons with signs such as "Genuine Snake Oil", Genuine being the abused term here, it is almost a subconscious admission of guilt on the part of the obscurer or deceiver , in this case Boris, the government and VI's know full well that this is a joke, a parody of "affordable", they know it and are subconsciously screaming at us thats its affordable, when we know and they know we know it isn't, but the word bending dance continues and the MSM allows it to happen...

In conclusion, the addition of the term "affordable" shouldn't be necessary, they simply would be affordable to the average wage earner and it would go unsaid, much like we don't append the term "wet" in front of water, we know it's wet, therefore it doesn't need the qualifier,the contempt unconsciously shown to the public by doing this really needs to be brought to everyones attention more often , or maybe I am an island on this one ;).

Edited by JustAnotherProle

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Orwell being taken to new levels!

£2800 being described as an affordable rent. Fecking hilarious. Clearly some people aren't on this planet!

Spot on the trouble is these people are in charge of the country

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Just a thought, when I see the term "affordable" used in connection with housing I automatically assume that it certainly isn't "affordable", at least by anyone with a sane view of personal finance.

Consider that the we do not use the term "affordable" in connection with any other asset or product in commerce one has to be immediately suspicious of it's use in this context. I see it as a red flag indicator when dealing with deception or obscurification, particularly when used in certain ways, a similar example would be the old west and it's snake oil salesmen or other fraudsters and charlatans who would roll around in wagons with signs such as "Genuine Snake Oil", Genuine being the abused term here, it is almost a subconscious admission of guilt on the part of the obscurer or deceiver , in this case Boris, the government and VI's know full well that this is a joke, a parody of "affordable", they know it and are subconsciously screaming at us thats its affordable, when we know and they know we know it isn't, but the word bending dance continues and the MSM allows it to happen...

In conclusion, the addition of the term "affordable" shouldn't be necessary, they simply would be affordable to the average wage earner and it would go unsaid, much like we don't append the term "wet" in front of water, we know it's wet, therefore it doesn't need the qualifier,the contempt unconsciously shown to the public by doing this really needs to be brought to everyones attention more often , or maybe I am an island on this one ;).

Or just define who it's affordable to.

"Affordable to bankers."

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Boris has always been evil. Wasn't he recorded threatening to have someone beaten up a few years ago. It's incredible how many naive people can't see through his foppish clown play-act when he is actually a nasty, manipulative ba$tard, a true Tory in every cliched sense. London was better under Livingstone and that's saying something.

You don't like him then?

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Just a thought, when I see the term "affordable" used in connection with housing I automatically assume that it certainly isn't "affordable", at least by anyone with a sane view of personal finance.

Consider that the we do not use the term "affordable" in connection with any other asset or product in commerce one has to be immediately suspicious of it's use in this context. I see it as a red flag indicator when dealing with deception or obscurification, particularly when used in certain ways, a similar example would be the old west and it's snake oil salesmen or other fraudsters and charlatans who would roll around in wagons with signs such as "Genuine Snake Oil", Genuine being the abused term here, it is almost a subconscious admission of guilt on the part of the obscurer or deceiver , in this case Boris, the government and VI's know full well that this is a joke, a parody of "affordable", they know it and are subconsciously screaming at us thats its affordable, when we know and they know we know it isn't, but the word bending dance continues and the MSM allows it to happen...

In conclusion, the addition of the term "affordable" shouldn't be necessary, they simply would be affordable to the average wage earner and it would go unsaid, much like we don't append the term "wet" in front of water, we know it's wet, therefore it doesn't need the qualifier,the contempt unconsciously shown to the public by doing this really needs to be brought to everyones attention more often , or maybe I am an island on this one ;).

Yes, you have jumped off the edge on this one.

However like much of the housing issue its just another case where we have ended up somewhere ludicrous through a process akin to boiling a frog.

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I don't know what the fuss is about.

Take a look at this...:

http://www.theguardian.com/money/2012/jun/22/affordable-home

In a busy road sandwiched between the office blocks of the City of London and the bijou streets of Islington lies what housing association One Housing Group calls a "calm home base where you can recharge the batteries". The association, which last year received a £20m government grant and says it is dedicated to "building affordable homes", has developed a block of 60 shared ownership apartments on the site. But if you are a hard-up house-hunter hoping to put your first foot on the property ladder, take a deep breath.

The biggest of the apartments, with a floor space less than the standard three-bed semi but without a garden, are on sale for between £695,000 and £705,000. It is, probably, the most expensive ever new-build offered by a housing association, yet it still meets the official criteria used to describe "affordable" – and qualify for taxpayer support.

Part-buyers of a 25% share in a flat will have to stump up £2,322 a month to cover the rent and mortgage. The housing association says buyers will need an income of £59,000 to qualify, but in reality even that income, nearly double the London average of £33,850, will leave them with little left over after paying the bills.

There are cheaper one-bed flats in the block – they start at £365,000 – but even these require the buyer to pay £1,209 a month for a 25% share.

Last week housing minister Grant Shapps traded blows with shadow minister Jack Dromey over the number of affordable homes being built in Britain. The Tories say they are up 25%, Labour says they are down. But however many are built, are they really "affordable"?

One Housing Group assistant director Matthew Saye says: "Affordable means something that is above social rent but below market levels." That means that as house prices have escalated in the capital, so has the price of "affordable" homes.

Across the Thames, close to Guy's Hospital in Borough, lies another shared-ownership development, built by Notting Hill Housing Association and opening this weekend. Potential part-buyers can find out about the 26 flats above shops a short walk from the station, on the First Steps to Home Ownership website.

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First Steps has an encouraging message from the Mayor of London, Boris Johnson, to dispirited Londoners fearful of never being able to afford even the tiniest home in the capital. He writes: "This website is London's gateway to affordable home ownership. My hope is that through First Steps, finding a home to buy will be made easier, and the cost of living in the capital more affordable."

But the new Beacon development is likely to dash those hopes. When Money researched the First Steps site, we found that the "required earnings" for the biggest of the homes, a three-bedder, will be a minimum of £104,250 a year. Nurses up the road at Guy's Hospital (average pay around £30,000) might find that a bit of a stretch.

When we contacted Notting Hill Housing Association, it said it had made an erroneous entry on the First Steps site. "The minimum share in these properties is 25%, not 50% as was originally stated on First Steps, so the minimum income required is rather less than £104,250.

"The qualifying income for what are superb three-bedroom properties is estimated at £75,500. While higher than the target income for the vast majority of our shared ownership properties, they still offer an excellent opportunity for those who … find it difficult to get on the housing ladder."

Many smaller shared ownership flats in cheaper parts of the capital far from the centre have much lower costs. But why are some housing associations charging upwards of £700,000 for "affordable" homes, and who do they think can really afford them?

One Housing Group stands by its belief that the £705,000 homes at its Central Street development are affordable for key workers. "Since the start of June, you can qualify for an affordable housing product if you have a household income of up to £77,200. If you look at this particular property, which is three bedrooms and aimed at a family, the market rent would be around £850 a week [£3,600 a month], so it's cheaper than going privately.

"If you are a couple of teachers, say, then it would be possible, although I accept it would be a stretch. One of our requirements for shared ownership property is that the purchaser sees a financial adviser. We have had very low levels of repossession at One Housing – maybe just one or two a year."

One Housing and Notting Hill are not alone among housing associations marketing properties at full market value prices which are 10 to 20 times the salaries of key workers. In Highbury, buyers are being asked for £182,875 for a 35% share of a £522,500 home. The blurb says: "Want to invest in your own home, but not sure you can afford the best areas? You can at Highbury Park."

In Hampstead, a one-bed flat is on for £335,000, in Marylebone a £600,000 two-bedder is already under offer, while in Crouch End a three-bedder is on offer at £455,000.

South of the river, in Putney, prices for a two-bed flat start at £445,000, and in Brixton the housing association expects £297,500, while in Mortlake, seven miles from the city centre, prices are £340,000.

Many potential buyers will struggle to understand how the mathematics of shared ownership stacks up. At the Mortlake development, for example, the housing association suggests the minimum income needed is £24,000, which will enable the buyer to take a 30% share. But it estimates the monthly cost of mortgage and rent at £1,242, which will take virtually every penny of the monthly take-home pay of someone earning £24,000.

In less desirable areas of London, there are several shared ownership properties where the equation is far less problematic. In Newham, east London, the First Steps site has a resale where the monthly cost for a 25% share of a one-bed is estimated at £585. In Lewisham, a new-build one-bed flat is going for £603 a month, which gives the purchaser a 25% share of a £182,500 flat.

A spokesperson for the Mayor of London, which runs the First Steps programme, said: "First Steps has helped more than 25,000 Londoners on low and modest incomes on to the housing ladder over the last four years, offering a very wide choice of affordable homes across the capital. The mayor has secured more than £627m to deliver affordable homes over the next four years, which will continue to deliver a range of properties across London aimed at meeting people's diverse housing needs and aspirations."

He said the average household income of First Steps buyers is around £34,000 and the average purchase price is just under £239,000.

One indicator that shared ownership is struggling, though, comes from the typical share buyers take. In the 1980s when shared ownership began it was typically 50% but now it's closer to 25%. Not many go above 40% largely because buyers will not qualify for the jumbo-sized mortgages needed to pay today's prices.

Likewise, "staircasing", where buyers move up from 25% ownership through to 50% or even 100%, is becoming less common.

The chief benefit for shared ownership buyers is no longer the chance of owning their own place outright, but the ability to access long-term rental subsidies plus a secure tenancy. Taxpayer support for shared ownership mainly comes in the form of a reduced rent for the part of the property the buyer cannot afford to buy. Typically, once in the door, the part-owner/part-tenant will only see their rent rise by RPI plus 0.5% a year.

But PricedOut, the organisation campaigning for first-time buyers and cheaper housing, says shared ownership is not the solution. Spokesman Matt Griffiths says: "When looked at in the cool light of day, shared ownership is stupendously bad policy. It is insane that some of the highest young earners in Britain are having to rely on government intervention to buy 25% of a house.

"It is simply no substitute for increasing total market supply, and in London's case dealing with a market that is being driven by speculative inflows of foreign money.

"There is very little trading up and if house prices go up further, the gap to the next stage of staircasing grows larger – trapping people in shared ownership. Government should be more concerned with cooling the market, rather than encouraging households to bid themselves up to the hilt with market exposure."

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The link below gives the total numbers of new homes being built per year (All Tenures as they describe it - so it includes Private Enterprise, Housing Association and Local Authority housing).


Dated 20 February 2014

https://

www.gov.uk/government/uploads/system/uploads/attachment_data/file/282775/House_Building_Release_-_Dec_Qtr_2013.pdf

Table 2b.

2013-14/Oct-Dec = 109,370 (per annum)

Bearing in mind that in about 1968 and at the peak about 360,000 new homes were being built per year.

_54388267_housebuilding_464.gif

and the Mayor of London makes a big hoo-ha over starting 98 new "affordable" dwellings with massive rentals.

It's shameful.


Note: Chart Reference.

http://

news.bbcimg.co.uk/media/images/54388000/gif/_54388267_housebuilding_464.gif

Edited by billybong

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In conclusion, the addition of the term "affordable" shouldn't be necessary, they simply would be affordable to the average wage earner and it would go unsaid

+1

Also the idea of an 'unaffordable' product is nonsense- if a product or service cannot be purchased by those at whom it is targeted then it's not 'unaffordable' it's simply mispriced.

How could any product or service be unaffordable to it's intended market in a free market scenario? After all if the customers you are addressing can't afford to buy your product then the price must fall until they can afford it- right? This is how market price discovery works.

The only way a price could remain unaffordable to it's target market would be if that price were being artificially propped up in defiance of market forces.

Which is exactly what schemes like 'Help to Buy' are designed to achieve- prevent the market from setting a realistic price.

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It is impossible to have some affordable homes around ones that are clearly not affordable....because once they are sold by the people that purchased them as affordable they then become unaffordable.... ;)

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This is a truly appalling attitude from Boris. Heaven help the UK if he ever becomes PM!

Does he actually know what shop workers, care workers, call centre workers, factory operatives, etc earn per month in the capital? This would be a good starting point to work out what an 'affordable monthly rent' on a flat should be.

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