London 'affordable home' priced at £700,000

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How does £705,000 sound for an affordable home? Not affordable at all, most likely. But that's the price housing association One Housing Group is charging for some new-build London properties.

Affordable housing usually means a figure between council rents and market rents. And they're usually aimed at key workers. Some very well off ones in this case.


Unaffordable

So how much is an affordable house in the Capital? When challenged, One Housing Group claimed a £705,000 home was still affordable for teachers and nurses. "Since the start of June, you can qualify for an affordable housing product if you have a household income of up to £77,200," One Housing Group told Patrick Collinson from the Guardian.


"If you look at this particular property, which is three bedrooms and aimed at a family, the market rent would be around £850 a week [£3,600 a month], so it's cheaper than going privately."

Perhaps but even just a 25% share in such a property would still mean rent and mortgage payments of more than £2,300 a month. One Housing Group does offer flats at £365,000 - but that will still mean at least £1,200 per month in monthly repayments, just for a 25% share. Many housing associations offering increasingly expensive properties still also received taxpayer-funded support.

Deposit squeeze

One Government affordable HousingOptions scheme (now replaced by another scheme called First Steps) is often tagged 'low cost home ownership'. But there is very little low cost home ownership for many in the UK, particularly younger people. It's even worse for those renting where sky-high property prices - and increasingly sky-high rents - means saving for a deposit for a property can take years.

Most shared ownership properties also tend to be new-build, which generally are more vulnerable to house price falls than used properties. The Government definition of a key worker is here. How many prison officers, fire fighters and teachers would consider, in reality, a £700,000 first-time property?

One Housing Group was not available for comment for this story.

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