Deepa Mistry
“I’m worried my family will still be in this two-bedroom flat when my three children are teenagers. Or even that I might be made bankrupt. Our whole life is on hold.”
I started looking for a flat of my own around 2007. By 2009 I was desperate to move out of the property I was renting. It was awful; there were mushrooms growing in the shower! Despite lots of viewings I couldn’t find anything I could afford. Then a Peabody shared ownership flat in Southwark came up. It seemed perfect. I was already familiar with the area; it was walking distance to my workplace; and as close to central London as I could afford.
I applied for a three-bedroom flat because I thought London would be a great place to raise a family once I met someone and settled down. But Peabody offered me a two-bedroom flat, as larger flats were going to people who already had children. I gave it a lot of thought before I accepted. The flat was great as a starter home but it wouldn’t work for a family. I considered waiting till I could afford to buy outright. But, in the end, I thought this is what I can afford and the flat suited me just fine as a single woman. That was my first mistake. My biggest regret is not hanging on and buying a freehold property, even if it was further out of London.
After an affordability assessment I bought a 75% share in 2010. I always intended to staircase and when I got a new job I thought I’d use the extra cash to buy the remaining 25%. But Peabody told me I couldn’t as I’d only been in the flat for a few months. Some of the money went on my wedding, and I put the rest aside for mortgage overpayments. Money advisors always advise paying off a mortgage as fast as possible. And it seemed sensible to reduce the outstanding loan, so it would be easier to take out an additional mortgage for the final 25%.
With hindsight, I’d have been better off if I’d staircased as soon as I was eligible and moved my shared ownership mortgage to a standard mortgage with a lower interest rate. That was my second mistake.
https://www.which.co.uk/news/2021/02/shared-ownership-homeowners-fear-taking-on-the-full-cost-of-cladding-remediation-bills/
It was a shock when we were told our block had the same cladding as Grenfell. But Peabody arranged for it to be removed and the works were completed by mid-2018. We were assured our flats were safe and that we wouldn’t be charged. We could probably have moved then but I was heavily pregnant with our third child so we stayed put. That was my third mistake.
By the time we were ready to move we needed an EWS1 form to sell. But our block was considered low risk after the remediation and therefore was not a priority for Peabody to commission the EWS survey. And then a fire safety assessment (FRA) revealed further issues.
With three children in a two-bedroom flat, we were desperate to move somewhere bigger. But Peabody refused to buy back our share. After I was featured on the Panorama programme The Home I Can’t Afford they agreed that could sublet if we met our mortgage provider’s criteria. It was complicated to obtain agreement for a Buy to Let mortgage because we had to juggle the different requirements of the housing association, the mortgage company and the estate agent. In the end, we realised subletting didn’t make financial sense when we compared the rent we were allowed to charge with the additional costs we’d incur. Plus we’d have made ourselves liable to capital gains tax when we did eventually sell.
My husband is from New Zealand. We’d planned to spend a few years there while the children were young so they could get to know their grandparents. But the EWS1 issue means we might not be able to move for another five or six years. By then it would be much harder on our children to uplift them from everything and everyone they’re familiar with.
Some people might think everyone with cladding is in the same situation. But it’s different for shared owners. We have to pay 100% of fire remediation costs even though we don’t have a 100% share in our home. We don’t have the same statutory rights as other leaseholders to lease extension, or to Right to Manage. We can’t set the selling price for our flat when we do eventually sell. And if we get into financial difficulties and can’t keep up with charges for waking watch and fire remediation costs the assured tenancy nature of shared ownership means we could lose everything; all the equity I’ve invested in our home (including those mortgage overpayments).
It helps to try and be constructive, so I’ve been talking to journalists and MPs about the intolerable situation my family are in, and sharing my story on LinkedIn. My children help to keep me sane and balanced. But now I’m worried my family will still be in this two-bedroom flat when my three children are teenagers. Or even that I might be made bankrupt. It’s put our whole life on hold. I’ve been fighting this for a year now; I would never have imagined our home could cause so much emotional stress and anxiety .
I really feel for anybody caught up in this horrible mess but it has to be said shared ownership is a joke, you own nothing. It’s a Government backed scam where a housing association is allowed to act as a ‘not for profit’ organisation and never adhere to Charity status. How can these so called housing associations and other suppliers of so called affordable housing justify selling a percentage of a piece of paper. When it comes time to do a repair which these people are responsible for, you own for example 50% but you still pay 100% for them to repair THEIR building through your inflated service charge which always seems to be over budget every year.. There’s no way shared owners can penalise these so called social housing providers when they breach their part of the lease but you try withholding rent or service charges for poor service and you end up with a forfeiture notice. I’d really like somebody to explain how any of that is even remotely fair. Not for profit organisations? That has to be the biggest joke around with their CEOs getting 6 figure salaries for ripping off the less well off.