My £475,000 home with Grenfell cladding is worth £50,000. So I’ll now pay off my Help To Buy loan, please
… But taxpayers would lose millions
A young mother has made an intriguing intervention into the dilemma of those whose new flats are blighted with Grenfell cladding.
And it may prove a tempting get-out for those with doubling ground rents, too.
Cecile Langevin, 32, who was due to give birth to her second child last weekend, wants to move on to a larger home.
Her £475,000 flat at New Capital Quay in Greenwich – where Galliard, which built the place four years ago and owns the freehold, blames the warranty insurer NHBC for signing off the cladding – has been valued for sale at £50,000.
All the flats at the site are blighted and unsellable.
In that case, she has decided, she will pay back the 20% Help To Buy loan right now.
“It is like someone has taken away our life choices, our freedom,” said Cecile Langevin, 32, after hiring a surveyor to value her property in the 11-block riverfront complex, New Capital Quay in Greenwich (pictured), built by developer Galliard Homes. “And nobody is doing anything about it,” she told newspaper The Guardian, reportedly in tears.
At 20% of the market value that means she would owe £10,000.
When Mrs Langevin bought the flat in 2014 she used savings, a mortgage and a £95,000 loan under the Help To Buy scheme.
So if she pays that off now taxpayers would lose £85,000 of its loan.
Many others bought at the New Capital Quay site with Help to Buy, which Galliard was heavily promoting at the site of 950 flats.
As yet, Mrs Langevin has had no reply from Target HCA, which administers Help To Buy, beyond saying that it is a “novel” request.
“They are being evasive, because they know if they have to do this for me they have to do it for everyone who asks,” she told the Guardian.
What applies in sites blighted by cladding would also apply to the 100,000 homes caught up in the double ground rent scandal.
The government’s ill-conceived bumper subsidies to the housebuilding sector could turn out to be utterly disastrous, with taxpayers facing multi-million payouts.
Martin Boyd, trustee of the Leasehold Knowledge Partnership, told the Guardian:
“The blight caused by Grenfell is national and the government doesn’t seem to be too bothered about that. So far, what we have heard from Greenwich and Croydon is just the tip of the iceberg.”
Regardless of how much of the government loan she has to repay, Langevin is still subject to huge negative equity because the value of the flat has plummeted.