Monday, October 20, 2008

Government fails first time buyers – period

Government home help fails first time buyers

"If everyone who does qualify did apply, the money simply wouldn’t be there. No wonder the government has been keeping stumm.”

Posted by matt_the_hat @ 05:11 PM (1325 views)
Please complete the required fields.



11 thoughts on “Government fails first time buyers – period

  • As far as I can see these schemes are all show and no go. I bet there have only been a relative handful that have actually succeeded in moving in.

    Reply
    Please complete the required fields.



  • I look into the initiatives every year, talk to the housing associations, estate agents, house builders, Joseph Rowntree trust, other trusts, and Homebuy agents for all of the government schemes.

    I always end up, no nearer to purchasing a home and feeling angry at the state of the housing market in the UK.

    The best of the government initatives is totally unaffordable, and that is the FTBI scheme. Whereupon, I would be required to purchase up to 50% of the property. Paying equity on a sliding scale after the first three years.

    Every government solution scheme, where I can purchase a larger percentage of the property, and then pay rent on the remaining percentage retained by the government, or trust, is exactly as expensive as taking out a 100% mortgate on the property. Me paying my ‘half’ plus paying rent on their ‘half’, makes the monthly repayment, [The important Bit] just as expensive as buying the property outright!

    And so is therefore totally useless to me. SHARED EQUITY IS A TOTALLY USELESS IDEA.

    Plus, why would any FTB even consider this? This week I have left my details with a number of local Estate Agents, and specified that I have an £80k Budget.
    But that I will only be interested in properties, that were priced at that amount, in or around 2000.
    The response got was very favorable!
    Six months ago, they would have openly laughed at me.

    Reply
    Please complete the required fields.



  • I’ve looked at them round my way, and the figures don’t make sense. The main problem is that they vastly overvalue the properties they are selling under these schemes, even by pre-crash standards.

    For example, a two bed flat in my area is valued at £270,000 under the shared ownership scheme. Before the crash, they were selling at around £185,000. Now the asking price in estate agent windows is around £160,000, but nobody is buying at that price. The properties that actually do sell at auction are going for around £75,000.

    So why would I buy 30% of a flat for £81,000 when I can get the whole thing for £75,000? It doesn’t make sense, and that’s why nobody’s interested.

    Reply
    Please complete the required fields.



  • 2. jonb – Yeh but you haven’t factored into the equation the fact that most people in this country can’t do percentages or complex maths like that – and you thought poor schooling was just government incompetence, they love it when a plan comes together.

    Reply
    Please complete the required fields.



  • Personally, the thought of owning 25% of an, ugly cheaply built studio flat in Basingstoke (“only 45 minutes from London”) never did exactly enthuse me.

    Reply
    Please complete the required fields.



  • The schemes I’ve seen mostly offer new-build properties, but the build quality can be rather questionable. I’ve yet to see a house or flat built in the last ten years which is of decent build quality.

    Reply
    Please complete the required fields.



  • There is a scheme called ‘Ownhome’ whereby you buy a property on the open market and the government give up to 40% of the price interest free for five years, followed by a low interest rate after that. They take up to 40% of the equity in return. In a falling market this works to the buyers advantage – you get ‘free money’ for five years and if the value drops so does their share. A smart buyer would buy out the gov’s share when the market hits the bottom.

    Reply
    Please complete the required fields.



  • These schemes are unfortunately not just difficult to understand but a clear rip off for first time buyers like me.
    I do qualify for most of them but I worked out the expenditures and they will leave me worse off than buying in the open market.
    All the properties advertised for shared ownership are massively overpriced not considering also the rent and the service charge to pay to the housing associations. Buyers are also charged (unfairly) twice: any time they want to buy a further stake on the property they are charged all the evaluation costs and increase in value (???) plus obviously the rest of the rent to pay.
    The government loans are a joke and I am not surprised that nobody is applying for these schemes (especially key workers).
    I just hope this disgraceful government is not going to buy properties from the developers with our taxes (as recently announced).
    Let’s keep on renting and wait for the market to collapse.

    Reply
    Please complete the required fields.



  • is available to 10,000 first-time buyers with a household income of less than £60,000 who are looking to buy a new-build property..

    err…how many…that covers my part of the country then!

    Reply
    Please complete the required fields.



  • planning4acrash says:

    Ehem, first time buyers should not take it personally. Government is failing everybody except their corporate sponsors. They even cannibalize their own power to give way to new global power structures. They don’t even look after their own power base!

    Reply
    Please complete the required fields.



  • buctootim,

    I saw something in one of these schemes that seems to imply that house prices are deemed to increase by 4.7% per year, so I’m not sure you would benefit from falling house prices.

    Reply
    Please complete the required fields.



Add a comment

  • Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
  • Please note that any viewpoints published here as comments are user´s views and not the views of HousePriceCrash.co.uk.
  • Please adhere to the Guidelines

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>