House builders at Penhurst Square, off Addiscombe’s Grant Road, have decided to offer their new homes on a 5 per cent deposit, as they try to push through the sales using public subsidies of up to £3,000 through a government scheme.
Developers Bellway have built 70 homes on a site which is handy for the tram network and close to Addiscombe Railway Park, the properties ranging from one-bed flats priced at more than a quarter of a million pounds, to four-bedroom terraced houses which they are trying to market at £525,000.
The Tory Government’s Help to Buy in London scheme can only be used on a property worth £450,000 or less, which makes some of the Penhurst Square homes ineligible already. Recent research reckons that the property market is continuing to grow at such a rate that by March next year the average price of houses will be too expensive to qualify for the scheme in nearly half the country. London will be particularly badly hit.
Which may explain why Bellway have looked to provide an incentivised scheme for their Croydon development.
The scheme allows buyers to purchase with a 5 per cent deposit for up to 55 per cent of the value of the home. Using tax-payers’ money, the government then provides an equity loan of up to 40 per cent of the property’s value, which is interest free for the first five years.
Critics of the Conservative scheme say that rather than address the over-heated housing market, Help to Buy has achieved little beyond subsidising the Tories’ mates in the construction industry, and has probably only served to keep pushing the cost of homes ever-higher.
Even Bellway hint at this in their latest promotion for Penhurst Square.
“According to a recent Halifax report the average age of the first-time buyer in London has risen to 34,” a spokeswoman for the builders said. “The lack of Help to Buy London properties coming on to the market – as more boroughs are priced out of the eligibility bracket, means young people are finding it harder to realise their dreams of home ownership.”
Bellway is showcasing its offer for Addiscombe and elsewhere in London at an event in The City next month, where purchasers will also have the chance to win a £20,000 interior design and furniture package. At the event, home buyers will be able to discuss their mortgage options with financial advisors, and preview a selection of homes using the 5 per cent deposit and up to 40 per cent equity loan scheme.
Bellway has so far sold 14 of the properties under the Help to Buy London scheme since homes went on sale in August.
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