Thursday, 9 January 2014

Reward Offered!

A notice has been taped to trees and lamp posts around where I live in recent days, headlined with the familiar cry ’Reward Offered’. This time, though, it is not there in the hope that a helpful neighbour will successfully find a much-loved family dog or cat, or recover expensive lost valuables, or as a promise of some kind of get-rich-quick scam. This reward is offered for anyone who sells the leafleteer a home.

The advert reads:

’Reward offered!
Do you think of selling your property?
But without the hazzle (sic) that comes with the viewings?
Get a reward instead of paying the agent’s fees?
And take the kudos for helping a local family on the property ladder.
Then please contact us! We are a family of four, looking to buy a 2+ bedroom property in this area for up to £150,000. If the flat needs refurbishment it's not a problem!
We are first time buyers and have a mortgage pre-agreement, so transfer will be quick and easy.
As little “Thank You” we will pay for a lovely weekend away for two of you!’

A mobile phone number is then given below.

It's an endearing appeal, if somewhat naive. And it seems highly likely to be borne out of desperation. The posters have been placed in Penge, south east London, in zone four, which, despite notable improvements, has proved to be stubbornly resistant to mass gentrification. One presumes the desire to live in the area is due to work reasons, perhaps schools. Yet, £150,000 will buy very little.

A quick look on Rightmove shows there are just five properties going for under £150,000 in the SE20 area and all of them are one-bedroom only. A bit cramped for a family of four. In an ideal world, at least a three-bed house would be appropriate but property prices in Penge have, as in the rest of London, rocketed over the last 15 years.

Back in 1999, £116,000 would have enabled a family to buy a modest three-bedroom house in the area. By 2002, it was £159,000, and by 2006, £232,000. After the crash, prices stagnated somewhat but in the last 12 months have soared once more, with prices ranging from £360,000 and even breaching the £400,000 mark.

So, while the money this family has may no longer be enough to buy a decent property, perhaps it is enough to access ’affordable housing’?

Affordable housing covers a range of options (a definition can be found here) but while rental options are available there is not much to buy in the area. Affinity Sutton have two houses for sale but both are well clear of £200,000. There may well be other properties available but the choice is clearly not huge. A working couple would need a combined income of at least £50,000 to secure a decent mortgage, and that's assuming a reasonably hefty deposit. For all too many, buying an 'affordable' house is way beyond their means. Perhaps this is just the sort of family who might benefit from the coalition government's controversial Help to Buy scheme; though, judging by their tactics, they are perhaps unaware of any assistance it might be able to provide.

Completely unrelated to this tale, but by way of contrast, eight minutes on the train line towards London is Herne Hill. Obviously, it's a much smarter place, blessed - Thames Water floods permitting - with a plethora of decent shops, some lovely pubs and restaurants and a thriving community. A farmers' market has prospered in Herne Hill since launching a year or so ago; the one in Penge sadly only survived a few weeks.

Yet, Herne Hill is part of Brixton and still has problems. For several months it has the most obvious and active drugs dealing den I've ever seen in London and until recently while property prices were high, there was a level of accessibility.

Like Penge, however, in the last couple of years house prices have soared. And it's hard to sum this up better than with an advert which appeared at Winkworth estate agents towards the end of last year. Displaying a £799,500 property, equipped with five bedrooms, three shower rooms, three reception rooms and two kitchens (?!) it was described, with all the sincerity an estate agent can muster, as a family house apparently 'ideal for first time buyers':

Obviously not for our very hopeful first time buyers of Penge.

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