Buying ex-council flat or flat above shop in London?
June 8, 2016 8:42 AM Subscribe
Just that really. More specifically in Hackney, London.
So we're finally thinking of buying a place where we live -- in Hackney, London. Yes, I'm interested if you think this is an awful idea, and the market will crash any day now, but we've waited for years and years and really think we're ready to buy now to insure against being priced out of our neighborhood. We're a family of four.
BUT. We've seen two places that would fit us pretty well, but each comes with a caveat. One is an ex-council flat. It has been re-done, and is in our budget. We just don't know what it's like to live in an ex-council estate -- it really seems to depend on the council, and we have no idea what Hackney's is like. I also feel bad displacing people for affordable housing, though it's just affordable for us too, and unfortunately it's not like if we don't buy it it it will revert to public housing. Any questions I should be asking or things to consider about owning ex-council?
The other place is great, huge and lovely (though needs work), but at the tippy top end of our budget, and above a card shop. Yes, the card shop may become a kebab shop down the line, but they would have to get planning permission and hopefully that wouldn't happen? This is in a vibrant (though still largely residential area -- just a few stores and cafes) that is diverse and not too far from a Tube. I've considered noise issues, and difficulties in getting a mortgage above a shop. Anything else I should consider?
Also, we sometimes go away for months at a time, and would want to rent out during those periods. Any red flags raised for either of these properties?
Would love any insights -- even tangential -- about buying in either of these circumstances in London! Or other resources I should look at. Also feel free to tell me that buying in either of these situations (or now at all) is a terrible idea. Thanks!
So we're finally thinking of buying a place where we live -- in Hackney, London. Yes, I'm interested if you think this is an awful idea, and the market will crash any day now, but we've waited for years and years and really think we're ready to buy now to insure against being priced out of our neighborhood. We're a family of four.
BUT. We've seen two places that would fit us pretty well, but each comes with a caveat. One is an ex-council flat. It has been re-done, and is in our budget. We just don't know what it's like to live in an ex-council estate -- it really seems to depend on the council, and we have no idea what Hackney's is like. I also feel bad displacing people for affordable housing, though it's just affordable for us too, and unfortunately it's not like if we don't buy it it it will revert to public housing. Any questions I should be asking or things to consider about owning ex-council?
The other place is great, huge and lovely (though needs work), but at the tippy top end of our budget, and above a card shop. Yes, the card shop may become a kebab shop down the line, but they would have to get planning permission and hopefully that wouldn't happen? This is in a vibrant (though still largely residential area -- just a few stores and cafes) that is diverse and not too far from a Tube. I've considered noise issues, and difficulties in getting a mortgage above a shop. Anything else I should consider?
Also, we sometimes go away for months at a time, and would want to rent out during those periods. Any red flags raised for either of these properties?
Would love any insights -- even tangential -- about buying in either of these circumstances in London! Or other resources I should look at. Also feel free to tell me that buying in either of these situations (or now at all) is a terrible idea. Thanks!
I think London is eventually due for a house price correction. But I also think you can't really time the market. If you've done the math (and thought about various possibilities including a price crash), and you've reached the thoughtful conclusion that this is probably the right time to buy a house for your specific family, I wouldn't worry about the state of the market as a whole.
(On the other hand, if you are acting less out of calm consideration, and more out of fear of missing out, then I'd advise you to hold off, just because fear is never a good reason to make a large purchase.)
For what it's worth, we bought a flat above a shop and have lived there happily for about five years now. We did not have any problem getting a mortgage, and no lender seemed to care about its above-a-shopness. We ended up loving the convenience of being so close to stores and cafes, and we get a lot more space for our money than we would even a block or two off the high street.
With both flats, I'd encourage you to visit at various times of day and of the week. Ideally you'd get access to the inside of the flat at those times, so you could hear what the street noise sounds like from inside, but in practice, the sellers probably aren't going to want to let you inside at odd hours. Even so, it's worth stopping by and standing outside for fifteen minutes. Before we bought this flat, we rejected a different one on a different high street after we visited on a Friday night and saw drunk people urinating on what would have been our front steps!
The only red flag I see in your description is that the one above a shop is at the top end of your budget and needs work. Double-check your budget and make sure that after you pay solicitors' fees, stamp tax, moving expenses, etc, you'll still have enough money left over for whatever work you want to do on the flat.
posted by yankeefog at 9:11 AM on June 8, 2016 [1 favorite]
(On the other hand, if you are acting less out of calm consideration, and more out of fear of missing out, then I'd advise you to hold off, just because fear is never a good reason to make a large purchase.)
For what it's worth, we bought a flat above a shop and have lived there happily for about five years now. We did not have any problem getting a mortgage, and no lender seemed to care about its above-a-shopness. We ended up loving the convenience of being so close to stores and cafes, and we get a lot more space for our money than we would even a block or two off the high street.
With both flats, I'd encourage you to visit at various times of day and of the week. Ideally you'd get access to the inside of the flat at those times, so you could hear what the street noise sounds like from inside, but in practice, the sellers probably aren't going to want to let you inside at odd hours. Even so, it's worth stopping by and standing outside for fifteen minutes. Before we bought this flat, we rejected a different one on a different high street after we visited on a Friday night and saw drunk people urinating on what would have been our front steps!
The only red flag I see in your description is that the one above a shop is at the top end of your budget and needs work. Double-check your budget and make sure that after you pay solicitors' fees, stamp tax, moving expenses, etc, you'll still have enough money left over for whatever work you want to do on the flat.
posted by yankeefog at 9:11 AM on June 8, 2016 [1 favorite]
There's no planning permission really necessary for a lot of change of use ordnances. Some have to post flyers but it is hardly public. You may be better off looking for the premises owner offering you first right of refusal if they choose to sell in the future or see if you can have a right of refusal or notice period in relation to extreme change of use you will need to define in writing.
posted by parmanparman at 9:14 AM on June 8, 2016
posted by parmanparman at 9:14 AM on June 8, 2016
Councils as freeholders can be problematic - they may have preferred suppliers for major works who are more expensive (I have lived in ex-council and had this happen but I wasn't in Hackney). You would also never have the right to buy out the freehold as you would in a private freehold. Neither are insurmountable but might be worth googling around a bit to see if anyone has any stories about Hackney (most of the horror stories I've seen involved SE London councils).
posted by theseldomseenkid at 9:48 AM on June 8, 2016
posted by theseldomseenkid at 9:48 AM on June 8, 2016
My brother recently tried to buy an ex-council flat, and was refused a mortgage because it was the only flat in the block to be sold to a private buyer. That wasn't something we knew would even be an issue. It was more than one mortgage company - he tried Nationwide, Santander and somebody else and they all said no. It wasn't the price - he ended up buying something more expensive. It was literally the lack of other private owners.
Having said that, he went on to buy a flat in a different ex-council block and is extremely happy with it, the council seem to organise all the communal work quite efficiently and his neighbours are fine. But it is an issue with some ex-council places.
posted by tinkletown at 9:59 AM on June 8, 2016
Having said that, he went on to buy a flat in a different ex-council block and is extremely happy with it, the council seem to organise all the communal work quite efficiently and his neighbours are fine. But it is an issue with some ex-council places.
posted by tinkletown at 9:59 AM on June 8, 2016
I'd be wary of having a council as a freeholder. If they decide any work needs doing, you'll have very little say, and could end up with an astronomical bill. And dealing with councils can be an exercise in extreme frustration.
I'm sure there are plenty of happy leaseholders, but there do seem to be a lot of unhappy ones too. Here's a story of leaseholder woe from today. This lot are in Camden, but I can't image Hackney is much different.
Hackney leaseholders have a Facebook group (though they will be the disgruntled ones only). Maybe contact them, get some first-hand info.
posted by ComfySofa at 1:38 PM on June 8, 2016
I'm sure there are plenty of happy leaseholders, but there do seem to be a lot of unhappy ones too. Here's a story of leaseholder woe from today. This lot are in Camden, but I can't image Hackney is much different.
Hackney leaseholders have a Facebook group (though they will be the disgruntled ones only). Maybe contact them, get some first-hand info.
posted by ComfySofa at 1:38 PM on June 8, 2016
I would wait a couple of weeks to find out the results of the EU referendum before making any final decisions. If brexit happens, some economists are predicting there could be a very rapid price correction. If you offer now it's unlikely you would even be able to get to the point of exchange before then anyway, but it's just something I'd be mindful of in your position.
posted by hazyjane at 4:19 AM on June 9, 2016
posted by hazyjane at 4:19 AM on June 9, 2016
I live above a grocery shop in London, on a busy vibrant street with many cafés, pubs and restaurants. The great thing is that no one cares if you make noise at night, since there's no one in the shop then. The tradeoff for that is that the street theatre NEVER stops; when the chatter outside the pubs and bars stops, the loud drunks start up. When they finally sod off, it's the delivery vans' turn. I quite like it-- it feels alive and unpredictable and interesting, and I've acquired an ability to fall asleep to the lullaby of London-- but your tastes may vary.
(I have a kebab shop a couple of doors down. Yes, it means loud people late at night-- but it also meant my street didn't get hit in the 2011 riots. That kebab shop was the only place on the street that didn't board up, because it's where all the police always go for kebabs, so there were always police on the street and the rioters went elsewhere.)
Ex-council: what is the building made of? If it's concrete, there can be issues getting a mortgage. Mortgage companies dislike concrete buildings for some reason.
Council estates vary, not just from council to council but estate to estate. Have a walk around the estate (with a friend) in daylight and see what the "feel" is. If it feels OK, go back at evening when it isn't fully dark yet (again, with a friend) and see if the "feel" has changed. Google the estate name for mentions on the web.. If you're worried about crime, maybe ask a local police officer (if you see one) what their experience of that estate is.
Best of luck! I hope whichever place you end up in will be a happy home.
posted by Pallas Athena at 6:12 AM on June 9, 2016
(I have a kebab shop a couple of doors down. Yes, it means loud people late at night-- but it also meant my street didn't get hit in the 2011 riots. That kebab shop was the only place on the street that didn't board up, because it's where all the police always go for kebabs, so there were always police on the street and the rioters went elsewhere.)
Ex-council: what is the building made of? If it's concrete, there can be issues getting a mortgage. Mortgage companies dislike concrete buildings for some reason.
Council estates vary, not just from council to council but estate to estate. Have a walk around the estate (with a friend) in daylight and see what the "feel" is. If it feels OK, go back at evening when it isn't fully dark yet (again, with a friend) and see if the "feel" has changed. Google the estate name for mentions on the web.. If you're worried about crime, maybe ask a local police officer (if you see one) what their experience of that estate is.
Best of luck! I hope whichever place you end up in will be a happy home.
posted by Pallas Athena at 6:12 AM on June 9, 2016
Response by poster: Thanks everyone! This is incredibly helpful. So hard to choose but I feel more inclined with the place above the shop now . . . And yes, we're thinking about Brexit -- but if the vote is to leave, not only will our hopes and dreams be shattered, but we would probably end up pulling out of an offer and waiting and seeing.
posted by heavenknows at 12:46 PM on June 9, 2016
posted by heavenknows at 12:46 PM on June 9, 2016
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posted by Emma May Smith at 8:51 AM on June 8, 2016 [2 favorites]