"I've put all my money in... now I'm stuck" (Shared ownership/Peabody)

[highcontrast]

https://www.bbc.co.uk/news/av/uk-55066169

'I've put all my money in... now I'm stuck'

"New proposals have been announced to expand the government's shared ownership scheme.

The scheme aims to boost home ownership by allowing people to part buy and part rent their homes, but a BBC investigation has found that some have been left with huge debts and escalating costs.

Deepa Mistry bought her home in 2010 on the shared ownership scheme and is now struggling with the increasing costs.

You can see the full BBC Panorama investigation, The Home I Can't Afford, on BBC One, 7:30pm on Wednesday 25th November."

 

What a state of affairs we have in this country.

[shlomo]

Just watched on BBC iplayer, it is as if the housing associations want to evict all those people and want to take possession of those properties.

...the new robber barons.

[MARTINX9]

 

Just watched on BBC iplayer, it is as if the housing associations want to evict all those people and want to take possession of those properties.

...the new robber barons.

I agree - the whole programme is worth a watch. Not surprising - but still shocking.

That irritating Mary Poppins style press officer representing the HA sector really irritated me in particular with her weasel words - particularly when she said well 60% of shared owners are happy with their purchase and the BBC interviewer responded by saying doesn't that mean 40% aren't happy.

And I felt angry for that guy who bought a flat in Bromley by Bow who had seen his service charges rise from £2,200 to £4,400 a year in five years - he dared to raise a complaint and he got a letter from the HA back threatening him with eviction if he didn't pay up - which could under the law mean he lost not just his home but all his equity and - rejected his complaint. The BBC intervened and the HA offered to give him £50 compensation for his time spent making the complaint - his service charge for about a week!

Or that woman who lived in a block with raw sewage leaking from pipes below her ground floor flat - the repairs were done and her service charge went up from £150 a month to £3,000 a month - more than her entire monthly salary.

And that poor woman in the video above - she felt she had ruined her kids lives as they are now stuck in a small flat in Southwark.

Of course its all perfectly fair as the HAs are all 'charidees' - so all the cash goes to build more homes. And then I saw a job ad for Clarion HA - who are the freeholder on the above Bromley by Bow flat - up to £138,000 for a procurement director plus an £8k car allowance. Yes - all those profits - sorry surpluses - are really going on more affordable housing!!

https://jobs.theguardian.com/job/7115348/director-of-procurement/

 

Edited November 26, 2020 by MARTINX9

[dirtyduck]

 

I agree - the whole programme is worth a watch. Not surprising - but still shocking.

That irritating Mary Poppins style press officer representing the HA sector really irritated me in particular with her weasel words - particularly when she said well 60% of shared owners are happy with their purchase and the BBC interviewer responded by saying doesn't that mean 40% aren't happy.

 

I saw the last 20 mins. Yea, I found that press officers bile particularly repulsive.

im waiting for a report of the wagers and massive bonuses these cockroaches are on.

[Peter Hun]

HA tenants had a decade long rent increase above the rate of inflation program imposed by the government. Rents went up by 50% in real terms.

This money was supposed to increase the housing stock, instead its spent on pay rises for staff.

[richmondtw]

 

That irritating Mary Poppins style press officer representing the HA sector really irritated me in particular with her weasel words - particularly when she said well 60% of shared owners are happy with their purchase and the BBC interviewer responded by saying doesn't that mean 40% aren't happy.

Agree she was shocking and seemed not to see any problem that only 60% of her buyers were happY

 

And that poor woman in the video above - she felt she had ruined her kids lives as they are now stuck in a small flat in Southwark.

I agree to an extent but also think I would never have had 3 kids in a 2 bed flat in the first place.  

 

And then I saw a job ad for Clarion HA - who are the freeholder on the above Bromley by Bow flat - up to £138,000 for a procurement director plus an £8k car allowance

HA salaries are the same level as LA.  I have worked with both and the money they get paid for what they do is incredible.  I could not get anyone to meet if it meant they would be working after 4 pm. Astonishing. 

[iamnumerate]

 

I agree - the whole programme is worth a watch. Not surprising - but still shocking.

That irritating Mary Poppins style press officer representing the HA sector really irritated me in particular with her weasel words - particularly when she said well 60% of shared owners are happy with their purchase and the BBC interviewer responded by saying doesn't that mean 40% aren't happy.

And I felt angry for that guy who bought a flat in Bromley by Bow who had seen his service charges rise from £2,200 to £4,400 a year in five years - he dared to raise a complaint and he got a letter from the HA back threatening him with eviction if he didn't pay up - which could under the law mean he lost not just his home but all his equity and - rejected his complaint. The BBC intervened and the HA offered to give him £50 compensation for his time spent making the complaint - his service charge for about a week!

Or that woman who lived in a block with raw sewage leaking from pipes below her ground floor flat - the repairs were done and her service charge went up from £150 a month to £3,000 a month - more than her entire monthly salary.

And that poor woman in the video above - she felt she had ruined her kids lives as they are now stuck in a small flat in Southwark.

Of course its all perfectly fair as the HAs are all 'charidees' - so all the cash goes to build more homes. And then I saw a job ad for Clarion HA - who are the freeholder on the above Bromley by Bow flat - up to £138,000 for a procurement director plus an £8k car allowance. Yes - all those profits - sorry surpluses - are really going on more affordable housing!!

https://jobs.theguardian.com/job/7115348/director-of-procurement/

 

Why do you need a car allowance if you work in Bromley By Bow?  The public transport is reasonable there and even if it weren't on £138K buy your own car!

[Former postman]

I'm in two minds about these schemes, on the one hand I feel like these people claiming ignorance as an excuse really should have read the small print before jumping into one of these crackpot schemes. On the other hand I'm asking, how did the government let HAs get away with running these schemes in the first place? 

[Unmoderated]

 

I'm in two minds about these schemes, on the one hand I feel like these people claiming ignorance as an excuse really should have read the small print before jumping into one of these crackpot schemes. On the other hand I'm asking, how did the government let HAs get away with running these schemes in the first place? 

Agreed, a bit like buying a sofa with nothing to pay for twelve months and then complaining it's too expensive a year later. That said the sofa and the business making them are subject to strict regulations on the credit provided and materials etc etc. HA need (along with private landlords) imho a regulatory framework to govern these issues. 

[msi]

 

I'm in two minds about these schemes, on the one hand I feel like these people claiming ignorance as an excuse really should have read the small print before jumping into one of these crackpot schemes. On the other hand I'm asking, how did the government let HAs get away with running these schemes in the first place? 

Because Government, both NuLabor and Tory sold themselves to the right wing idea of 'the state providing housing is bad cos it taxes us big boys, innit'. 

They put HA's as an alternative, so HA could borrow, invest, and take a profit (either directly or via 'costs').  Same idea for the ALMO's on tower blocks, such as Grenfell, or the Student loans 'company'.  Nice easy money for the elites and f*** the poor guy who pays on the end either financially or with their life.

[sammersmith]

 

I feel like these people claiming ignorance as an excuse really should have read the small print before jumping into one of these crackpot schemes

It wasn't even small print. Being responsible for 100% of maintenance costs whilst only owning x% has been a well known characteristic of SO since the beginning. Every single article that talks about SO that i've seen mentions this, even the very noddy MSE - style articles. 

I'd perhaps forgive them for the lease extension clauses and inflated costs associated with stair-casing and resale, as these are more opaque and dependant on developer/HA, but there really is no excuse to overlook something so basic as responsibility for maintenance costs.

Having been to the SO open days in my yoof i suspect these owners just saw the London madgainz around them and desperately wanted some of it at any cost. 

[Si1]

Any fake govt defined market is open to economic abuse by the agencies that define and regulate it. That's just market economics 101. 

[msi]

 

Any fake govt defined market is open to economic abuse by the agencies that define and regulate it. That's just market economics 101. 

..and yet standard playbook for 'free market' Tories - see Transport, Utiliies, Student Loans etc etc.

[Si1]

 

..and yet standard playbook for 'free market' Tories - see Transport, Utiliies, Student Loans etc etc.

Well you have to have some govt intervention as markets aren't perfect and you need some rules to instill market forces in the first place. However it should be the minimum amount necessary as govt is a common point of failure. 

[msi]

 

Well you have to have some govt intervention as markets aren't perfect and you need some rules to instill market forces in the first place. However it should be the minimum amount necessary as govt is a common point of failure. 

World of difference between a well regulated free market and, as you called it, a  'fake govt defined market'.  The Tories obsession with making everything a market means you get the latter instead of the former.

[HSvetz]

What I cannot understand is, even after the cladding issue is resolved, why anyone would want to buy the flat from Deepa and face the escalating maintenance cost, unless they buy 100% I suppose. But even then they will probably increase the service charge to compensate.  

[shlomo]

 

What I cannot understand is, even after the cladding issue is resolved, why anyone would want to buy the flat from Deepa and face the escalating maintenance cost, unless they buy 100% I suppose. But even then they will probably increase the service charge to compensate.  

I very valid point, she has no assets left anymore, she has played her cards wrong.

[LivingWithTheInlaws]

 

That irritating Mary Poppins style press officer representing the HA sector really irritated me in particular with her weasel words - particularly when she said well 60% of shared owners are happy with their purchase and the BBC interviewer responded by saying doesn't that mean 40% aren't happy.

Both my wife and I could not believe our ears here. How did that woman have the nerve to quote this figure as a success? 40% not happy!! WTF? Surely everyone should be happy in their home. 

In addition, why does nobody ever point out that if someone is living in a house and could only afford to pay half the value, then it is worth only worth that. This is all a con.

Finally. People get into this mess because they don't get the professional representation they need. How many use the developer's own solicitor? That's why they have no idea what they are getting themselves into.

[Si1]

 

World of difference between a well regulated free market and, as you called it, a  'fake govt defined market'.  The Tories obsession with making everything a market means you get the latter instead of the former.

True. Sometimes you need a bit of socialism.. Sometimes capitalism.

[Former postman]

 

 

In addition, why does nobody ever point out that if someone is living in a house and could only afford to pay half the value, then it is worth only worth that. This is all a con. 

This. 

Edited November 26, 2020 by Postman

[LesDawson]

I thought it was an excellent program showing a number of issues Shared Ownership 'owners' face in 30 minutes. I lived / was trapped in a S.O. flat for 11 years, horrific really...I really came close to suicide, and seems they are only getting worse. It's legal gangsterism to me.

Was surprised to see they were still claiming to be 'charitable' organisations, I thought they had given up saying that years ago. I wouldn't trust any of them.

[iamnumerate]

 

In addition, why does nobody ever point out that if someone is living in a house and could only afford to pay half the value, then it is worth only worth that. This is all a con.

 

Very true.  

 

 

 

Finally. People get into this mess because they don't get the professional representation they need. How many use the developer's own solicitor? That's why they have no idea what they are getting themselves into.

You have more chance of getting good legal advice on this forum than from the developer's own solicitor.

 

[Pop321]

Imagine if you owned a house as a landlord. (hold back the chunks...bear with me) 

Imagine as a LL instead of having to pay for those service charges, ground rent, repairs etc some mug could do that for you. 

All you need to do is sell them 25% of the house/flat and the yield doesn’t go down. Ie £100k house earning £8k rent is now a £75k house earning £6k rent...but now repairs are taken care of by the mug tenant. 

Use the £25k from the partial sale to buy another house to rent out....lather rinse repeat. 

Seriously, shared ownership seems to be the mother of all evil disguised as helping people out. 

I understand it’s a step on the ladder but if price increases make the rungs wider then it doesn’t work. 

Not sure I can see any advantage of shared ownership for tenants. 

[Burrito]

I watched the Panorama programme...

What I didn't quite understand, it that all of the problems didn't seem to be specific to shared ownership at all?

Increasing service charges, construction problems, short leases and high cost of extending leases - all of these are problems with new-build leasehold flats, regardless of 75% ownership or 100%.

[Si1]

 

I watched the Panorama programme...

What I didn't quite understand, it that all of the problems didn't seem to be specific to shared ownership at all?

Increasing service charges, construction problems, short leases and high cost of extending leases - all of these are problems with new-build leasehold flats, regardless of 75% ownership or 100%.

I suspect shared ownership just compounds the problem by making it much much much more difficult to sell and move on