THE FIRST TIME HOME BUYERS' CLUB
As a nation we are experiencing a housing shortage. To make matters worse many properties are now far too expensive to buy. The average home in London costs £414,490, nearly twenty times the average wage (£21,840) for 22 to 29 year olds. This makes it almost impossible for first time buyers to get on the property ladder. The phrase ‘Affordable Housing’ refers to houses reduced by 20% of the market value, so a two bedroom property in Camden worth on average £828,000, would be worth £662,400, completely out of reach for a first time buyer.
BUILDING MORE HOMES IS NOT
THE ONLY SOLUTION
Many people say the reason for the high property prices is we are not building enough homes. In London 26,230 new flats and houses were built in 2013 this was a 60 per cent rise on 2012 and the highest figure since its records began in 1987. Although this is only half of the 49,000 new homes required, housing prices in London have not showed signs of decreasing, in fact they have increased on average by 16.3% in a year. Building new homes is not solving the housing crisis because they are being brought by investors and second home owners. The real issue is the cost of housing.
AFFORDABLE DESIGNER HOMES
At home work play we believe there is another solution, building more new houses will not affect the real housing shortage, unless they become more affordable. We are a social enterprise dedicated to providing designer sustainable homes at prices
that people can afford.
WHAT WE DO
Buying in bulk saves money. This is also true when it comes to buying properties and land. As a group opportunities increase exponentially, due to the greater buying power.
Home Work Play is a social enterprise and the first ever ‘first time home buyers’ club’.
We find development opportunities for first time buyers. We pull together the expertise of Architects, Designers, Solicitors, Engineers and Builders to build your dream home, at prices linked to local wages.
PRICES LINKED TO LOCAL WAGES
We value our properties based on the median wage of the area in which the homes are built.
We then apply the principle that no family should be forced to spend more than half of their income on housing. Multiply this figure by a standard 25 year mortgage at an average of 5.5% and add a 10% deposit. This gives a price that local people can genuinely afford.
The only catch being, if you ever chose to move, you simply reapply the formula and sell the homes in the same way – meaning that house prices rise with wage inflation rather than on the whims of the market. Standard fees are paid to the Design Team. All profits are reinvested into future developments.
WHO CAN APPLY?
Anyone who cannot afford to buy a suitable home on the open market can apply.
However, priority will normally be given to:
Key public sector workers
First time buyers
Generally you will need to earn around between £18,000 and £60,000 in London to qualify, although it can be less if you have a large amount of savings. You will also need at least £2,000 of savings to cover the initial costs involved with buying a home.
CHALLENGE BORIS JOHNSON
Boris Johnson recently announced he is to use publicly owned land and institutional investors’ cash to build new rented homes.
There are two sites in East London up for sale using a legal covenant to ensure that any buyer must use them for rented housing. The sites in Silvertown and Pontoon Dock, have enough space for 700 homes: only one third will be affordable rented housing, this is not enough.
As for the rest of Government owned land, the majority will be purchased by developers on the open market and sold with similar amounts affordable housing. This is simply fuelling the current problem.
We challenge Boris Johnson to implement the following
3 Step First Time Home Buyers’ Plan:
THE 3 STEP FIRST TIME
HOME BUYERS’ PLAN
Social Enterprises, Charities, Land Trust and other such organisations dedicated to building homes valued to local wages should be given priority bidding rights to
Government, Planners and Social Enterprises work together to evaluate housing provision and reasonable cost for land.
Cheap finance provided via a new help-to-build scheme that guarantees lending to individuals and first time home buyers’ clubs, similar to Help to Buy mortgage guarantee scheme already in place.
A lack of affordable housing has become a major issue in London, if we do nothing we will be condoning a lost generation, which will have detrimental social and business knock effects, creating higher welfare bills. The Government will receive market value for land and no maintenance costs.