Home grabbing: London Council pricing community out of existence

Posted by GLA Conservatives in Blog   Share2013

May
30

• East London residents offered significantly less than market value to make way for redevelopment
• Resident offered less than what he bought for, wiping out savings
• 70 year old who has lived in home for 38 years is left £100k out of pocket

 
Leaseholders in Hackney’s Colville Estate will see their homes demolished under plans to redevelop the area by the local council. Under the Compulsory Purchase Order (CPO) process, in which property can be obtained without consent from the owner, homeowners have been offered well under the market value, meaning they will no longer have the financial means to remain in the area.
 

Andrew Boff, Londonwide Assembly Member, has taken up the cause of these homeowners and says:

Delivering the Colville Estate masterplan cannot be at the expense of fairness and justice. Colville leaseholders have done the right thing by saving up to buy their own home and investing in improvements and up keep. Now they are being offered way under market value for their properties. One resident I spoke to will in fact be given less than what he paid for the property in 2007, meaning his savings will be completely wiped out. Buying a home in the new development will not be an option for many of them as the cost will be too high. Hackney Council are wrong to grab people’s homes and price this community out of existence. They should immediately offer a sensible settlement to all those affected.

 

Savings wiped out by offer
Darren Lisney bought a property on the Colville Estate in 2007 for £205,000. It was an investment for his family’s future, and to provide income for retirement. His final offer was for £200,000, which is below market value, and well short of the £400,000+ cost of the units on the new development. The settlement on offer means he will see his savings wiped out.
 
70 year old £100k out of pocket & may be forced to move away from borough
Jo Vudali’s father Edward is almost 70 and has lived in Harwood Court on the Colville Estate for 38 years. The CPO will leave him £100K out of pocket and force him to move out of Hackney completely. He bought his 2 bed flat over 10 years ago. The council evaluated it at £160K and then revised it to £180K. However, the independent evaluation was put at £285K. Edward will now have no option but to agree a shared equity deal in which he will own about 20% of the replacement property (which is said to be valued at £450K) or move out of Hackney completely and leave his family behind. He could have sold up and moved out years ago but trusted the council to do the decent thing and offer him a fair price (market price).
 
First time home buyer £50K out of pocket and thrown off property ladder
Emily Mackey bought her first home in 2004. The CPO will leave her £50K out of pocket and force her to move out of Hackney completely. The council valued her 2 bed flat at £220K and gradually revised it to £250K. However the independent evaluation was put at £300K. Emily will now either be forced to accept a shared equity deal on a replacement property, something she has not yet seen and won’t be ready for three years (estimated to be valued at £460K) or she will be thrown off the property ladder.
 
 
Notes

• Andrew Boff is Londonwide Assembly Member and Leader of the GLA Conservative Group
• Case studies are available for interview
• Funding for the redevelopment comes directly from the Housing and Communities Agency. The Mayor of London has taken over powers of the HCA for the Capital.