Newspaper article The Evening Standard (London, England)

First-Time Buyers Can Pocket the Difference; Now Young Londoners Renting Privately Are Getting a Chance to Buy, Says David Spittles

Newspaper article The Evening Standard (London, England)

First-Time Buyers Can Pocket the Difference; Now Young Londoners Renting Privately Are Getting a Chance to Buy, Says David Spittles

Article excerpt

Byline: David Spittles

THOUSANDS of young, upwardly mobile Londoners working in the private sector -- key to the capital's economy -- are "trapped" in often expensive private rented property. They are in the wrong job to qualify for affordable housing, where public sector workers often take priority, yet with earnings of less than [pounds sterling]60,000 they are unable to afford a mortgage on a highly priced property.

Pocket, a new private affordable housing provider set up by a former City financier, has devised a business model requiring no public subsidy that aims to deliver hundreds of new first-time buyer homes across London during the next five years.

The Pocket "brand" is aptly named: small homes on small sites at small prices (20 per cent below local market values). A debut development of 22 apartments in Camden sold out in weeks. Other schemes are in the pipeline in Ealing and close to Queen's Club tennis centre in Hammersmith, while reservations are being taken at a 32-home eco project being built at Fermoy Road, in the north-western corner of Westminster borough.

Mark Vlessing, director and founder of Pocket, believes his formula is a better solution than shared ownership or subsidised rented housing. "There is no stigma attached and people get to own their homes outright."

How is it possible for Pocket to profit commercially and act like a charity? First, it buys infill plots passed over by developers who have been scared off by the planning requirement to provide on-site social housing.

Second, its "do-gooder" brand finds favour with local councils, who allow higher-density schemes (more units) of entirely private flats.

Third, factory design and spacesaving ideas mean smaller, functional flats can be built more cheaply.

Buyers are singles and couples on low-to-moderate incomes ([pounds sterling]60,000 is the cut-off point). "When we started, we expected that most buyers would be in their twenties but the average age is 33," says Vlessing. "Typically, buyers earn between [pounds sterling]37,000 and [pounds sterling]40,000 and have been renting for nine years. …

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