The upward spiral in the cost of housing around Britain has made recruitment and retention of staff a serious issue for many schools. Last year, there were some 1,020 vacancies in maintained schools in London, 670 in the South East and 450 in the East of England.

Two years ago, some 1,610 posts in schools were filled by temporary workers. And a survey by the Greater London Authority found turnover rates in some schools were as high as 30 per cent in 2001. Of the teachers surveyed, 63 per cent cited cheaper accommodation as a reason for seeking work outside the capital.

To ease the problem, the Government has introduced a second keyworker living scheme costing pound;690 million. Launched in April 2004, it replaces the previous starter-home initiative and covers London and parts of the South East and the East.

Teachers in state schools, FE and sixth-form colleges can now get an equity loan of up to pound;50,000 to help them buya home on the open market.

Original rules giving some teachers priority have been scrapped. But for a bigger loan of up to pound;100,000, only teachers in the capital “with the potential to become leaders of London’s education system” need apply.

To qualify for the bigger sum, you must amass a score on seven criteria: advanced skills teacher status, the fast-track scheme, the new designation of chartered London teacher, those who have crossed pay-scale threshold or who have management responsibilities, working in challenging schools or teaching shortage subjects.

The loan means you would owe a percentage of the value of a property. For example, a pound;40,000 loan would be 25 per cent of a property costing Pounds 160,000. You would repay 25 per cent of the value when you sell it or stop being a key worker; until then you would not pay interest or capital.

If you already own a home, you could get help to buy a larger place to meet family needs. Once you have a loan you can sell the first home and carry forward the help you received. You might even be entitled to a bigger loan at that time.

The money you receive depends on your household’s income, savings, any property you already own, any financial commitments such as student loans, the mortgage you can get, and the purchase price of the property you want to buy. The property must be suitable for your household’s needs and within reasonable travelling distance of your workplace.

An alternative to buying on the open market is to buy a new property from a “registered social landlord” (housing association). This option includes shared ownership, in which you buy at least 25 per cent of the home and pay a reduced rent on the remaining share. You can increase your share in the future when you can afford, and perhaps even buy it outright. When you sell, you receive a percentage of the sale proceeds equal to the percentage of the property you own at the time of selling.

Another option is intermediate renting: a rent is set at a level between that charged by social and private landlords. In a typical case, you pay 75 to 80 per cent of the local market rent. You would have an assured shorthold tenancy while you remain a key worker but must pay full rent and will receive 28 days’ notice once you cease to be a key worker.

WHERE TO GET HELP

You can find more details on the deputy Prime Ministers’s website at: www.odpm.gov.ukkeyworkerliving or contact the zone agent that covers your area:London: Tel 0845 300 2820; www.keyworkerliving.co.uk

Surrey, East Sussex, West Sussex, Kent, Berkshire, Hampshire, Buckinghamshire and Oxfordshire: Tel: 0845 600 6699; www.keyworkerliving-sep.co.uk

Hertfordshire: Tel: 01582 869 440; www.leavalleyhomes.co.ukEssex: Tel: 0700 266 2846; www.moat.co.uk

Bedfordshire and Cambridgeshire: Tel: 0845 456 6757; www.keyhomes-east.org.uk

Norfolk and Suffolk: Tel: 0845 850 2050, www.orbit.org.ukThere are general schemes that aren’t specifically for teachers. Registered social landlords (housing associations) run low-cost, home-ownership schemes for people who cannot afford to buy their own.

To get details of registered social landlords running schemes in your area, contact the Housing Corporation. Tel: 0207 393 2000.

HOW IT WORKS IN PRACTICE

London is divided into five zones. By the end of October 2004, 775 teachers in the East zone had enquired about the pound;50,000 loan scheme.

Of these, 483 had applied, 283 had been approved, and 217 said they were looking for a property. Of those, 44 had found a place and 22 had completed a purchase. Around 120 are expected to have completed by the end of the financial year. A further 100 teachers in the East zone are expected to have been helped under the pound;100,000 scheme.

It will take a year or so for the allocated funds to be spent on new properties for either outright sale, shared ownership or key worker renting. These are being built across the capital by registered social landlords. It is described as “a massive programme” by Jim Munson of the Metropolitan Housing Trust. The property you get must be within a reasonable travelling time from where you work - 90 minutes in London, 30 minutes elsewhere.

PITFALLS

The keyworker living scheme covers only those parts of the country where the problem is acute. The funds are also limited, so you must apply early to have any chance.

Even a loan of pound;50,000 or pound;100,000 may be of limited help to those who want more than the tiniest one-bedroom flat. The average house price in inner-London Southwark (in the lowest 25 per cent of prices) is pound;155,000. It is pound;160,000 in Brent on the north-west outskirts of the city.

Many teachers might not want to be tied to the profession in this way. You must pay back the loan within two years if you stop teaching.