Monday, Oct 02, 2006

Another government disaster in the making

guardian: Keyworkers to benefit from HomeBuy scheme

"Under the initiative, homebuyers take out a mortgage for 75% of a property's value with one of a group of selected banks and building societies. The lender will also provide the borrower with a 12.5% equity loan and the government will also lend 12.5%, making a total deposit of 25%."

So that means that for essential workers who can't afford a property, they will be lent 100% of the value - of the property they can't afford. How does this help? When nurses are killing themselves in desperation from debt problems where are they going to find replacements?

Posted by inbreda @ 01:51 PM (472 views)
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13 Comments

1. talking rot said...

This is a New Liebour Con which is dangerous and morally wrong. What it does is neatly avoid the problem caused by high house prices and means the Treasurey is not beset by Public sector Unions clamouring for higher wages so that key workers can afford a basic living place. Can you image a future Labour PM (Brown?) listening to news reports of striking nurses demanding 15% pay awards JUST so they can afford a home. It must bring a shiver to their rotten spines.

It also creates 2 markets: one for the rich property owners who own their home(s) outright. And one for the dependent [conned] key worker prooperty owner who is give the illusion of home ownership. Is it not a far cry from a Council House?

Monday, October 2, 2006 02:16PM Report Comment
 

2. george monsoon said...

I would like to think that the curtain will fall on this show that we call the housing boom, long before the government pass this through.

Monday, October 2, 2006 02:32PM Report Comment
 

3. Chillilizard said...

This reminds me of leveraged derivatives. Essentially, a leveraged derivative is a loan on a bet on the future.

"and is aimed at helping public sector workers, social tenants and those on council waiting lists buy their first home."

I wouldn't recommend gambling (with borrowed money) to these people. But its not gambling as long as its property I suppose.

Monday, October 2, 2006 03:17PM Report Comment
 

4. Randomkevlar said...

Being a key worker, I looked into this type of scheme a couple of years ago (this may be a different one?) and as stated in the piece

'On selling the home the government and lender are entitled to a 12.5% share of the increase in the value of the property'

but when i looked into this more I found that if the value of the property goes down the government and lender still want the full amount back.

i.e. - if you have a 150,000 morgage and 50,000 from gov/lender and a HPC of say 20% happens and you decide to sell up (as advised after 5 years) you still will have to pay the 50K back to the gov/lender, this would be fair enough if they did not want a share of the increase in value if the value goes up but there do...the whole thing is deeply sick to my mind. If you can't afford a house for your family then don't buy one, if we all refuse to pay for these overpriced houses then......HPC

Monday, October 2, 2006 04:06PM Report Comment
 

5. Boarder said...

Special extra help for our more-equal likely Party voters.

Monday, October 2, 2006 04:06PM Report Comment
 

6. Mininidge said...

I have enjoyed reading this site for over a year now. I have learned alot & perhaps the may be the more intelligent people on this site can help me understand a few things.
I cant afford a home. Why are these more deserving? The products I design are sold in other countries and bring income into this country to pay for 'Key Workers' surely that makes me a key worker. I will also have to retire at 68+ these key people can retire at 60. My pay rise this year was 2.3% along with most of my other collegues. I loose almost a third of my wages to the Tax criminal every month and get nothing useful in return.
I don't get it!!

Monday, October 2, 2006 04:25PM Report Comment
 

7. tyrellcorporation said...

Mmmm... what about the millions of people shoe-horned into call centres and warehouses across the UK who are being paid the minimum wage and have no puiblic sector perks and pensions and are fully exposed to the risks of the open market and globalisation?!?!?!?

Oh I forgot they probably won't be voting Labour...

This type of market meddling and social engineering make me vomit - 'key workers'... all you need to do is change two letters round and you'll get a whole new phrase which is much more fitting!!!

Monday, October 2, 2006 04:58PM Report Comment
 

8. European-bear said...

When will anyone ever learn.....incentives ranging from tax breaks, to shared equity schemes never work. All they do is create more people who can afford houses at current prices, and when demand exceeded supply (as in UK), it just pushes the price up. It never helps anyone...fundamental law of economics. All it will do is give buyers a bigger millstone of debt around their neck, than otherwise as the price has been pushed up. To seriously help it needs supply side changes, such as planning laws being changed and mode homes built together with restrictions on underoccupancy such as holiday homes or abandoned houses (eg the 500,000 empty homes in the UK). In fact measures to "increase affordability" by its effect on pushing up prices could even have the undersiarble effect of increasing speculation.....and hence even push up the price further.....

Monday, October 2, 2006 05:00PM Report Comment
 

9. sovietuk said...

I wonder if there is a voting intention box on the application form

Monday, October 2, 2006 06:56PM Report Comment
 

10. indiablue19 said...

It's what in the overtly criminal world they call "hush money." In this scenario where the crimes are carefully chosen and neatly legislated and the con is paid for by taxpayers, they call it "benefits for essential workers." Fortunately, the Labour Party is not composed of any essential workers and can be written off by voters as a dead loss as soon as possible. I wouldn't want to chance being an "essential worker" stuck in this trap when Liebour is a thing of the past.

Monday, October 2, 2006 11:49PM Report Comment
 

11. george monsoon said...

I work along side Civil cervants in my job, but I work for a private company. They always complain about low pay, but on balance, they have a wacking pension, massive payoff in the event of redundancy, and more payed holiday than soft mick. They also get an anual wage increase over and above inflation. If I need a pay rise, I have to apply for it. The waiting list, needless to say is long, and usually results in peanuts.


Tuesday, October 3, 2006 08:20AM Report Comment
 

12. inbreda said...

I had the misfortune to accidentally come across a TV channel showing the "highlights" from the Tory conference, where Davith Karmeroon - you know, the one that's really in touch with the British public whilst having a good economic brain and strong leadership skills and really well defined policies - well, he was saying that people wanted interest rates to stay low .... as if he could / would make sure that happened if he got into power.

He certainly proved his IQ to me.

Guess it's time to vote lib dem. It's lucky that voting isn't like betting on horses - the aim is NOT to back the winner ;-)

Tuesday, October 3, 2006 03:03PM Report Comment
 

13. Jimmyjames said...

Yew Korkers? What's tree surgery got to do with it?

Tuesday, October 3, 2006 03:36PM Report Comment
 

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