‘Affordable’ Hoxton home at £1m price tag
- Credit: Archant
An “affordable” shared ownership flat valued at more than £1million has shocked potential buyers and highlighted Hackney’s growing housing crisis.
The price of the three bedroom shared ownership property in Hoxton is aimed at “low earners” but calculations suggest that any potential owner would need a household income of more than £77,000 for just a 25 per cent stake in the flat.
MP Meg Hillier said this week the huge cost of the flat in The Cube development in Wenlock Road underlines how “out of reach” getting on the property ladder is for local people.
Shared ownership aims to give people on lower incomes the chance to buy a stake in the property which they can increase over time, while paying rent on the remainder of the home.
The advert on Share to Buy’s website for the apartment, which is being sold by Islington and Shoreditch Housing Association (ISHA), says priority will be given to local authority and housing association tenants, Ministry of Defence Workers and people who live and work in Hackney.
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But the housing association estimates that to afford a 70 per cent mortgage on the £256,250 share, and have enough money to pay a rent on the remaining 75 per cent of the property as well as the monthly service charge, would-be buyers would need to be able to afford more than £2,400 a month in housing costs.
Figures estimated by ISHA shows the guideline minimum income is more than £70,000, while the median salary in the borough is £31,000. Hackney South and Shoreditch
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MP Meg HIllier, said: “This underlines just how out of reach home ownership is for local people. The fact that people on incomes of nearly £80,000 a year are in line for housing support through shared ownership shows the housing market is not working. Housing providers need to take a hard look at what their aims are and who they are supporting.
“We need more affordable rented property locally or we’ll lose key workers and others on moderate incomes from our borough.”
ISHA said in a statement just three of its shared ownership properties had been valued above £900,000, all of which were on the edge of the City where homes “regularly” have seven-figure price tags.
It added that all three were three bedroom homes, which meant several purchasers could team up to buy.
ISHA said shared ownership was a more affordable alternative than outright sale and market renting, placed against market rents which were often in excess of £700 per week for a three-bedroom home.
Clare Thomson, chief executive for ISHA, said: “We recognise that the home highlighted is out of reach to many of the households we prioritise to assist.
“It does still however meet our objective of assisting people who would otherwise not be able to purchase in that area. The proceeds from shared ownership are invested in providing low cost rent homes in the same area.”