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Matchmaker turns homemaker

For those unable to get on the property ladder, an unusual joint ownership project provides a step in the right direction. Martin Whittaker reports

Henley is regarded as the quintessential English town, associated with the Royal Regatta - straw boaters and champagne picnics on the banks of the Thames. But you won't find many teachers living there.

The town, in south Oxfordshire, was recently declared Britain's most expensive place to live and the average house costs pound;412,000. A glance in a local estate agents' window confirms that a two-bedroom terraced house costs pound;228,000, while there is nothing to rent for less than pound;875 a month.

Catherine Brooker, head of Gillotts School, an 11-16 mixed comprehensive in Henley, says that because of the high house prices, recruiting and keeping good quality teachers is a constant battle. The only members of her staff who live locally are second-income earners. Many of her teachers have to commute from cheaper areas, some braving the heavy traffic daily.

"We have had people who have come for interview and have withdrawn on the basis that there's nowhere they can afford to live," she says. "I also lose staff - it's more of a retention issue, actually - because they tend to move somewhere where they might be able to get into the housing market."

But two governors at a primary school further up the Thames in neighbouring Pangbourne have devised a novel idea to help teachers get on to the bottom rung of the housing ladder.

Helen Adams and Jan Ferrer started their own internet service, FirstRungNow Ltd, to help key workers to club together to buy a house. They had the idea after seeing first-hand the effect that high house prices had on the jobs market.

"Recruitment at school is always an issue for one reason or another, but not being able to afford to live near where you work is ridiculous," says Helen Adams. "We are reaching the point of recruiting a deputy head, but it's been difficult to get people to apply for that reason."

For those who already share rent and want to buy together, FirstRungNow Ltd advises on the technicalities and legalities of joint ownership. It acts like a dating agency for first-time buyers.

"Suppose two people have got together and want to buy a property but they realise they need a third person," says Ms Adams. "They can come to us and register with our introduction service with a view to meeting somebody else, get to know them and see if they feel they are someone they could buy with."

Those who register for the service send their personal profiles and details of the kind of person they would like to share with. The company then gives them profiles of people who are already on their books.

Initially they communicate via email. Details remain confidential so it is up to them if they wish to make further contact by phone. The initial introduction service and three profiles are free, but 10 profiles and a guide on joint home ownership costs pound;10.

The service is still in its infancy - it was launched in November - but it has already attracted surveyors, engineers, IT consultants, accountants and trainee solicitors. Ms Adams believes it is also ideal for teachers.

"Teachers have been used to sharing rented accommodation when they were training or finishing their degree," she says. "We want them to view it as a possibility and not to think that they can't move to Pangbourne, for example, because they can't afford to live there, but to realise they can buy in their preferred area if they join forces."

But would you want to commit to buying a house with those you shared with as a student? Or with somebody you have just met through an agency? Are they trustworthy? And what happens if it all goes pear-shaped?

The Council of Mortgage Lenders says it has no hard evidence on how widespread joint ownership has become. But it warns of potential pitfalls along with the benefits.

"If the participants are not part of a couple but are buying jointly, it may help them initially," says spokesman Bernard Clarke. "But looking further ahead, they may want different things and this is where the problems could arise. One person might want to move to another area and sell his or her share of the property, so all participants would need to ensure they had a legal agreement that protects all their interests."

FirstRungNow recommends that potential buyers draw up a legal trust deed that sets out ownership shares and includes a cohabitation agreement - a sort of homeowner's pre-nuptial contract - for partners who want to protect themselves from unnecessary cost and litigation if they end the deal.

"If something changes in the arrangement then the cohabitation agreement is there, setting out what to do in the event of someone wanting to move out or who is not paying their part of the mortgage," says Ms Adams.

Recent research by the Halifax found that key workers, including teachers and nurses, cannot afford to buy a home in more than half of the country's towns.

Last October, Deputy Prime Minister John Prescott unveiled a new key worker programme which started on April 1, replacing the existing starter home initiative. With pound;1 billion to spend over two years, it aims to extend housing assistance to key workers such as teachers and health workers at different stages in their lives - not just first-time buyers.

The programme will offer a scheme called Homebuy, providing an equity loan of at least 25 per cent of the property with a value up to pound;50,000.

In the London area, higher loans will be available to a small, targeted group of teachers.

It also offers "intermediate renting" - a rate between social housing and open market rates - as well as shared ownership on new-build schemes in which the purchaser buys a share of the equity and pays rent on the balance.

The new scheme aims to help some 6,000 key workers in each of the next two years in London, the South-east and eastern regions and part of the South-west.

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