London Keyworkers Camp Out For Property Bargains

[Ash4781]

http://www.guardian.co.uk/money/2008/jul/1...buyers.property

London keyworkers camp out for property bargains

Keyworkers in London are camping out in the July rain in order to bag a property bargain at Parkside, a new development in Wandsworth, south London.

This Sunday, Notting Hill Home Ownership (NHHO), one of the UK's largest housing associations, is launching the Key Worker's Initiative (KWI), which will enable buyers such as nurses, teachers, police officers and social workers to buy a property at half price.

Unlike traditional shared ownership schemes, buyers will not have to pay any extra monthly rent to the housing association on the part of the property they don't own - so some lucky keyworkers will be able to buy a flat worth more than £280,000 for just £140,000, and only pay the mortgage, not the extra rent.

From 11am on Sunday there will be 50 KWI flats up for sale on a first-come, first-served basis. But some keyworkers have been camping out since Thursday in order to make sure they don't miss out on the bargains.

Mark Vaughan of the NHHO said: "I really didn't think this would happen - I thought there'd be a queue early Sunday morning, but definitely not three days ahead.

"It is quite unbelievable and just goes to show that the housing market may look pessimistic, but if the deal is good enough then people will be prepared to buy."

The cheapest one-bed apartment at Parkside would cost £222,500, but is on sale to keyworkers for just £91,225. The cheapest two-bed apartment would be £272,500 and will cost keyworkers just £122,625. The only other extra fee they will face will be a monthly service charge of about £150.

By this morning, six keyworker campers had turned up to pitch their tents outside Parkside's marketing suite.

Lorraine Timms and her daughter Carly arrived yesterday afternoon and are first in the queue. Mother and daughter are taking it in turns to camp out while Carly, a teacher, is at work.

Lorraine said: "We got here at about 4pm yesterday and we're taking it in turns - last night a friend of ours camped during the night, and tonight Carly will be staying out here.

"We came down because we know it's first-come, first-served, and Carly desperately wants the show flat so it's great that we're first in the queue.

"It's very exciting, because there's no way she could afford a flat otherwise. The show flat is fantastic - she'll get it as it is, kitted out with everything down to the cutlery."

She added: "It's only just started raining, and with quite a few of us here it's been really fantastic. We're all having a good time."

The show flat Carly is hoping to buy costs £300,000 at full price - she will be buying it for £132,000.

Terry Raymond, sales manager at Parkside, said he has been making the campers cups of tea and gave them umbrellas when it started raining. "I really didn't think people would come down this early," he said. "Who said the housing market was dead, hey?"

Keyworkers in London earning less than £60,000 a year can qualify for the scheme.

Is it free money or are the flats massively overvalued ?

[renterbob]

http://www.guardian.co.uk/money/2008/jul/1...buyers.property

Is it free money or are the flats massively overvalued ?

No and Yes.

One bed box flat for 100K

That's luxury down there.

After leaving london myself recently I still cannot understand why keyworkers would want these places.

There is no life living in a box.

Maybe 'savvy' keyworkers are keeping away.

[Radge]

Here's you answer:

Prices

Studio apartments start from £182,500. One bedroom apartments start from £247,500.

Shares are available to purchase between 25% and 75%.

You must be earning at least £25,000 as a single applicant for a one-bedroom apartment or £30,000 as a couple for a two bedroom apartment. You will also require savings of at least £4,000 to cover the cost of buying the home.

[Converted Lurker]

http://www.guardian.co.uk/money/2008/jul/1...buyers.property

Is it free money or are the flats massively overvalued ?

bottom line? It's cheap (based on todays over valued prices) and the mortgages are already in place for the 50% financing. It is very attractive and you can see why it's proving to be so popular. We can argue re. the over valuation at point of sale, the possibility that you're buying into neg.equity in a heartbeat, that if you want to move on you'll have to pay any shortfall....however, just watch as the goalposts are shifted over the years once you're in. "Neg eq? not a problem sir we'll wipe that off as part of the govt/local govt "Fresh start move" scheme." Long term (20 years on) those who bought using these methods in the 80's have done well. If you're 'in that game' and go through a trough and peak you'll win...based on past performance*...

* no disclaimer needed etc

[Sinking Feeling]

There's one born every minute!

Are these people totally insane, I think the North of England must be at least 6 months ahead of the South - that is the only sane conclusion I can come to. Then again these are teachers and other public sector workers - not always the sharpest tools in the box!

[OLDFTB]

"she will be buying it for £132,000"

Rubbish! She will be buying a share of it for £132,000.

They will all bitterly regret being stuck in those things in a couple of years time when they see houses being sold for the same price they paid for half a flat.

[Nicholas Cage]

This is a really good scheme for those who can get in, on selling you pay the % discount of the market value at that time, not the original value.

So a 50% discount, 140K mortgage. Amount owed on sale 140K

If prices fall 30% you can staircase at the market value at any time (minimum 10% of share owed and fees for surveyor)

Property falls 30%, amount owed 98K, pay off whatever % you can, if prices increase then on sale your share will cover it anyway.

This is much better than the HomeBuy scheme normally is, very simple, but a loss making scheme for the government.

Edited July 19, 2008 by maxwell

[Oliver Sutton]

however, just watch as the goalposts are shifted over the years once you're in. "Neg eq? not a problem sir we'll wipe that off as part of the govt/local govt "Fresh start move" scheme."

What - New Liebour throw even more taxpayers money at a problem that was largely their creation in the first place.

Somehow, I don't think so.

[Tonkers]

Here's you answer:

Prices

Studio apartments start from £182,500. One bedroom apartments start from £247,500.

Shares are available to purchase between 25% and 75%.

You must be earning at least £25,000 as a single applicant for a one-bedroom apartment or £30,000 as a couple for a two bedroom apartment. You will also require savings of at least £4,000 to cover the cost of buying the home.

Crazy, the flats are 50% over valued. So I buy my 50% at £140K - say the market value of the flat falls to £120K, what then? I sell and get £60K? I must have this deal all wrong.

Also, is £150 per month service charge a bit high?

[MRMX9]

Perhaps these people aren't viewing this from the monetary angle - they are public sector workers who want to own (at least a share of a property) and thus have secure housing in a very expensive area like Battersea rather than have to rent and move around every couple of years. Plus being keyworkers - policemen, social workers, teachers - they are highly unlikely to ever be made redundant so should be able to meet the mortgage payments (a mortgage on £132k being well below local rental costs).

I normally don't approve of shared ownership - but being able to buy half a new flat (with no rental on the balance) just a stones throw from Victoria and Sloane Square for £150k and maybe buy the other half at a lower cost if the market crashes in a couple of years doesn't seem too bad a deal to me! Plus you also get to pay the lowest council tax in the country in Wandsworth.

My concern however is about the principle of the state giving subsidies to people on £60k to buy a flat in effectively central London - is this the best use of our money?

[Guest DissipatedYouthIsValuable]

It's a trap

[Sinking Feeling]

Crazy, the flats are 50% over valued. So I buy my 50% at £140K - say the market value of the flat falls to £120K, what then? I sell and get £60K? I must have this deal all wrong.

Also, is £150 per month service charge a bit high?

Yes, it gives people a unique leveraged position so they can lose more than they ever thought possible!

Perhaps these people aren't viewing this from the monetary angle - they are public sector workers who want to own (at least a share of a property) and thus have secure housing in a very expensive area like Battersea rather than have to rent and move around every couple of years. Plus being keyworkers - policemen, social workers, teachers - they are highly unlikely to ever be made redundant so should be able to meet the mortgage payments (a mortgage on £132k being well below local rental costs).

I don't really know London very well, but I'd always imagined Battersea to be a cheap area as the two things that its famous for are a power station and a dogs home. I wouldn't be too sure that key workers have safe jobs after reading Darling's comments in the papers this morning.

[Guest DissipatedYouthIsValuable]

[Justice]

Yet another bribe by the goverment for council employees.

Bet it will help if your black and gay too.

This should not be allowed and it's cost us tax payer in the long term.

Even so shared ownership is just a way for these housing association to get more money then they would from having money in the bank and the stupid person buying a share gets to pay maintance cost and taxes and even the legal fees whilst buying or selling. thick as $hit.

Time WrongMoves had the option of filtering out these silly deals as 99% of the population are not interested in buying such properties.

[Glittery Hoo Haa]

Battersea is a very expensive area.

I still think £150k on a share of one of those flats is too much.

Far better for the government to work towards a situation where professionals in secure careers earning above average salaries are able to buy without assistance or self certs.

Bet it will help if your black and gay too.

What a pile of bigoted, ungrammatical nonsense.

Edited July 19, 2008 by Glittery Hoo Haa

[MRMX9]

Yet another bribe by the goverment for council employees.

Bet it will help if your black and gay too.

This should not be allowed and it's cost us tax payer in the long term.

What an offensive comment - don't black and gay people (who probably use a lot fewer services anyway and thus make a lower call on the taxpayer as they generally don't have kids) pay taxes too. Eligibility is based on your job type with people living/working in Wandsworth (hardly your looney left politically correct council) getting priority - pure and simple!

Lets keep the comments to the matter in hand!

[BufferBear Bitcoin Bull]

I don't really know London very well, but I'd always imagined Battersea to be a cheap area as the two things that its famous for are a power station and a dogs home. I wouldn't be too sure that key workers have safe jobs after reading Darling's comments in the papers this morning.

I grew up in the borough of Wandsworth and my local areas were Streatham, Tooting, Balham, and Batersea. About 10+ years ago the description above was correct. Not anymore. Recently moved from Balham where 3 bedroom terraced houses cost about 650-700k (180k+ in 1998!!!!). Battersea is more like 800k+. It's really changed. On my new road I now see Ferraris, and Aston Martins. I Personally, I think the gentrification of large parts of Wandsworth is sad. . I sometimes feel like an impostor when I walk down Northcote Road

[MRMX9]

I grew up in the borough of Wandsworth and my local areas were Streatham, Tooting, Balham, and Batersea. About 10+ years ago the description above was correct. Not anymore. Recently moved from Balham where 3 bedroom terraced houses cost about 650-700k (180k+ in 1998!!!!). Battersea is more like 800k+. It's really changed. On my new road I now see Ferraris, and Aston Martins. I Personally, I think the gentrification of large parts of Wandsworth is sad. . I sometimes feel like an impostor when I walk down Northcote Road

Agreed - but that's how true blue Wandsworth Council likes it! I agree Battersea is extortionately priced but its near the river and convenient for central London (Sloane Square is a short walk away). Its terrible - but a sad fact of reality in central London i.e. only the incredibly rich, the desperately poor and under 25s living in rowdy flat shares live there now!

[Moo]

Is it free money or are the flats massively overvalued ?

It's "free money" for those who, thanks to a government who've got absolutely no concept of how economies work, are considered "key". Sorry, but if I decide I'm oooh, soo stressed, and get myself onto disability, that's two nurses worth of money down the pan, and that's excluding indirect effects from the business I work for. So who the hell's "key" now then?

(Note : For the hard of thinking, the answer is "No-one, because you can't have nursey without other people who're willing to contribute to pay for her. Doesn't matter whether the chicken comes before the egg, you need both.")

On a slight side note, £150 per month service charge on a one bed flat!?! What do you get for that? 24-hour on-call oral sex!?!

Edited to add a few words, without which it would have been a bit shorter. Like Ronnie Corbett.

Edited July 19, 2008 by Moo

[Elizabeth]

"she will be buying it for £132,000"

Rubbish! She will be buying a share of it for £132,000.

They will all bitterly regret being stuck in those things in a couple of years time when they see houses being sold for the same price they paid for half a flat.

Well actually I think that a whole flat will sell for about 2/3rds of the price of 1/2 a flat now. London is a ridiculous place - tulip city.

[yellerkat]

Agreed - but that's how true blue Wandsworth Council likes it! I agree Battersea is extortionately priced but its near the river and convenient for central London (Sloane Square is a short walk away). Its terrible - but a sad fact of reality in central London i.e. only the incredibly rich, the desperately poor and under 25s living in rowdy flat shares live there now!

In the late 80s (some) Battersea residents were called "Soanely Rangers" - "It's Soanely 5 minutes from Sloane Square!".

[Justice]

What an offensive comment - don't black and gay people (who probably use a lot fewer services anyway and thus make a lower call on the taxpayer as they generally don't have kids) pay taxes too.

Gays yes, Blacks-immigrants no.

Whites have 1.6 babies so you work out who having the 2.4.

Eligibility is based on your job type with people living/working in Wandsworth (hardly your looney left politically correct council) getting priority - pure and simple!

You need to add Leicester, Luton, Leeds to the 'Wandsworth' list and thats just what i know about.

Lets keep the comments to the matter in hand!

Are you saying that immigrants have not effect on house prices or wages.

OK sorry about the Gay bit but you get the message i'm sure.

[notrich]

What an offensive comment - don't black and gay people (who probably use a lot fewer services anyway and thus make a lower call on the taxpayer as they generally don't have kids) pay taxes too. Eligibility is based on your job type with people living/working in Wandsworth (hardly your looney left politically correct council) getting priority - pure and simple!

Lets keep the comments to the matter in hand!

Erm no!

[Bloo Loo]

What an offensive comment - don't black and gay people (who probably use a lot fewer services anyway and thus make a lower call on the taxpayer as they generally don't have kids) pay taxes too. Eligibility is based on your job type with people living/working in Wandsworth (hardly your looney left politically correct council) getting priority - pure and simple!

Lets keep the comments to the matter in hand!

The comment is not offensive. What is offensive is positive discrimination, and thats what the comment alluded to IMO.

Now if a Key worker is a government employee, just exactly who is paying for these people to be employed as key workers, ah yes, the other KEY workers who happen to be in the Private sector producing wealth- clearly the message is that wealth creation is not necessary in our miracle economy.

[Radge]

Fortunately the gays are far too bright to sign up for a scheme like this so the PC crowd can calm down a bit.