Free Land?????

[HotRod]

Caught some IV on the radio in the car this morning and I can't find anything to back it up on the web, but there was a discussion regarding some scheme (proposed I think) to offer FHBs "free" land for them to build their home on.

Then in 10 years time they had to either buy the land (I assume at market value then) or sell up to pay for the land.

Am I the only one thinking this is a bit daft?

I see a lot of problems 10 years down the track.

Trying to find a link.

Found it:

http://www.2ue.com.au/blogs/2ue-blog/free-land-for-firsthome-buyers/20130305-2fhyh.html

 

[beachgurl]

The ones who can't afford the land to start with will be the ones that in 10 years time will be complaining that they can't afford to pay for the land now as they've just bought a bigger house that they 'need'.

Alternatively it will encourage people to build a bigger house on the free land and then when their circumstances change with having a family they won't be able to keep the house when it comes time to pay for the land component.

 

[moyjos]

I heard this too.

in Qld at one point our Housing commision let you buy "increments" of your house. It started as low as 25% and you increased ownership (at market value) at predertemined periods. I can't remember all the details, it didn't last long...so I guess it wasn't very successful.

The most popular scheme here was you got your loan through the commission and paid basically whatever you liked as long as it was not less than 25% of your total combined income. This was popular with my peers in the early 80's. You qualified for the loan as a couple, paid it off for a year or so, then wife has babies and the mortgage dropped to 25% of hubbies wage.

 

[Honest John]

The Brits tried this years ago. The council bought the property and sold half to you. You obtained a mortgage on the 50% of the property, less any deposit and paid rent on the other half. I believe the minimum deposit was 5%. Your name appeared on the title but obviously a charge was placed on the property so you couldn't do a moonlight flit. At any time, if your circumstance improved, you could get a mortgage on the other half and buy the councils half outright. You were responsible for maintenance, etc.

It did work and I never heard any complaints, unless someone out there knows otherwise? As far as I recall it allowed a lot of FTB's to get on the property ladder and freed up a lot of social housing that would otherwise be occupied.