Wednesday, 23 April 2014

Care must be taken over homebuy

We are writing in response to the article ‘Thousands of new homes stand empty’ (Inside Housing, 14 November). Selling properties in a market where mortgage finance is difficult to obtain is challenging, but the government-funded my choice homebuy scheme has also had a huge impact on the ability of associations to sell their properties.

Homebuy agents, which hold the database of those registered as eligible to buy new build homebuy properties for associations, have been working in partnership with developers to promote my choice homebuy as a way to sell house builders’ unsold properties on developments where associations are trying to sell new build homebuy properties. In many cases house builders have reduced their values below those of the associations, which are required to sell their properties at market value. This has left associations on these sites in a position where they are unable to compete. It would be interesting to know if homebuy agents promote my choice homebuy on their own new build homebuy sites and if they face similar problems.

Some builders are marketing these schemes as ‘not affordable housing or shared ownership’, thus implying that new build homebuy is a second class product. We would be interested in both the government’s and the homebuy agents’ view of this approach on a government-funded scheme which, by definition, makes it affordable housing.

In addition to my choice homebuy there is the first-time buyers’ initiative and the government is also set to release homebuy direct, yet another initiative aimed at helping builders to sell their unsold homes.

We appreciate that the government wants to maintain the capacity of the house building industry, but has it considered the financial impact this could have on associations which have been left unable to sell their properties?

We agree with the National Housing Federation’s Lucy Thornycroft that the government should be using its position to ensure the flow of new build homebuy mortgages. However, we feel that the government should also look to restrict the availability of homes through my choice homebuy, the first-time buyers’ initiative and homebuy direct to developments where there are not any existing or planned new build homebuy properties.

The latest quarterly Royal Institution of Chartered Surveyors’ survey reports that the difficulties people have had in buying and selling homes have spilled over into the rental market. As a number of associations are now considering rent to homebuy as a way to dispose of their unsold properties, care will need to be taken to ensure that the market is not flooded with these properties only for them to also be left empty.

Adie Fox and Paul Stagnell-Howe, Stagnell Fox Limited

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