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Shared ownership helps realise Jemima’s designs on a Hackney home

Shared ownership helps realise Jemima’s designs on a Hackney home

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Threatened with eviction after refusing to pay an unexpected rent rise from her new landlord, designer Jemima Goodey turned to Shared Ownership to take her housing situation into her own hands.

As demand for housing surges in London, the balance of power between private landlords and private rent tenants has swung firmly in favour of the former. In Jemima’s case, the tiny one-bedroom-flat she was renting was bought by a new landlord. He immediately demanded that she pay an extra £200 in her monthly rent, on top of the £1,250 she had already agreed to in her 12 month tenancy agreement.

Jemima was shocked at how immediate and forthright the rent increase was. “I’d been renting the flat for three and a half years and had six months left to go on my current leasehold agreement. I was stunned by what little control over the situation I had.”

Jemima has dedicated a large portion of her life to studying design to get the ideal job, in a city world renowned for its cutting-edge design industry. To do so, she made the move from York to London twelve years ago. She also thought she’d found a home where she could live in peace of mind and focus on growing her career. “Being threatened with eviction forced me to have a look at what options are out there to get on the property ladder.”

While London is one of the world’s greatest, most vibrant cities to live in, constant rises in property value are steadily pricing out increasing numbers of Londoners. Recent research by KPMG* shows that in London, the annual wage required by a first-time buyer is £77,000 per annum. When you consider that the average London wage is £27,999, the disconnect between London property prices and affordability becomes clear.

Jemima looked into Shared Ownership, a scheme open to first-time-buyers with combined household income of a maximum of £71,000 (for those looking for a one or two bedroom home in London) who would otherwise be priced out of home ownership. It works by allowing home-seekers to part-buy, part-rent their properties. They begin by purchasing between 25% and 75% of their home – depending on what they can afford – which they pay for with savings and a mortgage. They then pay a subsidised rent on the portion they don’t own, as well a service charge.

A Shared Ownership scheme, Chervil House, developed by Hackney Council and marketed by Metropolitan, caught her attention. “It was pure luck I found out about it. I don’t often work from home, but during the London tube strikes I had no option.” With no work commute that day and a bit more time on her hands, she had a look at her personal emails. There she saw an email campaign for a large, new, one-bedroom flat in Hackney, available to own through Shared Ownership.  

Soon Jemima had registered her interest through Homematch and so began the wait to find out if she would be approved to purchase the flat.  A nervous five-day wait culminated with news from the Metropolitan sales team that the first hurdle had been overcome – she met Greater London Authority priority criteria and was eligible as a first time buyer to put an offer in on the flat. The rest of the sales process unfolded smoothly with a little help from Metropolitan’s sales team.

With the help of her savings, Jemima put together her deposit and opted to buy a 50% share of her home. She says that her monthly outgoings on mortgage, rent and service charges are £1,200 now, compared to £1,250 when she was renting her flat - or the £1,450 her new landlord had wanted to charge her.

Within three months Jemima had a financial check and mortgage approved and was living in a new, large one-bedroom flat with a fair sized balcony. Visibly thrilled, she added, “It’s really changed my life, I’m not only paying less than I was before, I now actually own my own property. No more being evicted for not wanting to pay crazy rents!”

Jemima is also paying considerably less than the going rate on the open market. The monthly cost on a mortgage for buying a like-for-like property outright in Hackney averages at £1,448 per month, while the average rent is a whopping £1,386 per month.

With Shared Ownership, Jemima has the option to ‘staircase’ up, increasing her owned portion of the property over time. Her goal, she says, is to eventually increase her share with a view to one day owning the place outright.

When asked what she plans to decorate the large wall behind her couch with she beams, “Oh, I’ve got lots of stuff already to go up there! At the moment I’m more interested in getting my oven fitted!”

Daljit Soul, Metropolitan Sales Manager, said “We’re delighted that Metropolitan could help Jemima get on the property ladder and gain more independence.  It was a pleasure to work with Hackney Council and make this happen.  We wish Jemima all the best in her new home”.

Looking back on her experience with Shared Ownership from Metropolitan, Jemima says she would recommend it to a friend. “If you can’t get on the property ladder the traditional way, I would definitely say this is the way to go. And I’d definitely recommend Hackney Council and the sales team from Metropolitan as well – everyone I’ve spoken to has been really friendly and really helpful.”

*http://www.theguardian.com/business/2015/may/04/first-time-buyers-need-to-earn-77000-a-year-to-live-in-london

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