Charity begins at home

The Peabody Trust has been housing people on low incomes all over London since 1862. Now key workers are benefiting, too

No question about it, Sue Dempsey has got a great new flat: stylish modular design, sweeping views from her third-floor balcony, and a fantastic location on the border between Fulham and Kensington. And it's all thanks to a man who died 135 years ago. Yes, the fact that she's paid just £67,000 for a brand new, one-bedroom flat - with resident porter - in one of the country's most expensive residential areas is all down to George Peabody.

No question about it, Sue Dempsey has got a great new flat: stylish modular design, sweeping views from her third-floor balcony, and a fantastic location on the border between Fulham and Kensington. And it's all thanks to a man who died 135 years ago. Yes, the fact that she's paid just £67,000 for a brand new, one-bedroom flat - with resident porter - in one of the country's most expensive residential areas is all down to George Peabody.

This American-born tycoon-turned-philanthropist donated £500,000 in 1862 towards the setting-up of the Peabody Donation Fund. Commonly known as the Peabody Trust, this is the organisation that co-owns Sue's flat - and which, in various ways, houses another 50,000 people across London.

Having moved from Baltimore to London in his early forties, Peabody spent the next 30 years mixing business and good works, founding a public education system in the post-Civil War American South (for both blacks and whites), as well as building the sturdy brick Peabody housing estates that have become part of the London landscape. His aim was "the construction of such improved dwellings for the poor as may combine in the utmost possible degree the essentials of healthfulness, comfort, social enjoyment and economy". Pretty forward-thinking, for 1862.

Definitions of poverty may have changed, but to this day the Peabody philosophy prevails, with tenants at the lower end of the income scale paying only £54 a week for a one-bedroom flat and £67 for a two-bedroom property. And, in addition to its large-scale tenancy operations, the Trust has also branched out into shared-ownership schemes, giving key workers such as Sue (an NHS nurse) the chance to buy their own properties.

In Sue's case, she paid 30 per cent of the total £223,000 purchase price on her Fulham flat, while the Trust paid the other 70 per cent (£156,000). Now that she's moved in, she pays rent to the Trust (£370 a month), plus her portion of the mortgage (£280 a month). Total outgoings of £650 a month - for which she gets a foot on the property ladder and a 30 per cent stake in the apartment. Should it sell for £300,000 in a few years' time, she'll stand to receive £90,000.

"I thought I was never going to be able to afford a place in London on my wages," she says. "My husband had died, and I'd moved back in with my mother. Then her flat was compulsorily purchased, and we had to move out to Cheam, in Surrey, which meant I suddenly had an hour-and-a-half commute into work each morning. On a salary of £26,000, I had no chance of getting a mortgage on a place in London. I was on the point of giving up and getting a job out of town, when I heard about Peabody's shared-ownership scheme."

As an NHS nurse with 20 years' experience, on the point of moving away from the metropolis, Sue immediately qualified for a place at Peabody's new Fulham development, on the site of an old primary school in Lillie Road. She moved in at the end of last year - and hasn't looked back. "It's like a dream, getting this place," says Sue, who was born and brought up just down the road. "The last thing I wanted to do was move out of London, but like so many other people in the NHS, I just couldn't afford to stay. As for moving up the pay scale, the only way I could do that was by going into management, and I love the practical side of nursing too much to do that.

"The great thing about this development is that it's full of lots of other people like me - teachers, social workers and so on. And that same mix will continue because there's a clause in the contract that says the flats can only ever be sold to other key workers. I think it's a brilliant scheme."

Sue has only been sheltering under the Peabody wing for five months. By contrast, Eva Duke was born on the Peabody Estate in Wild Street, Covent Garden, in 1919 - and she's still there. "I was an Armistice baby," laughs Mrs Duke, now 85. "When we were little, we'd lie in bed and from about 2am we'd hear the horses and carriages arriving for the old fruit and veg market.

"Almost everyone who lived here worked either at the market or in printing, or else they had jobs in the West End theatres," Mrs Duke adds (the stage door of the Drury Lane Theatre Royal is just across the road).

"There was a real community feel about the place. My son Bob suffered brain damage because of a smallpox vaccination that went wrong. He couldn't speak, but wherever he went in Covent Garden, there'd always be people looking out for him, to see he came to no harm. He belonged here - everyone counted him in, if you like."

It's a moot point, of course, whether people would be so well-disposed today; there's no doubt in Mrs Duke's mind that, while living standards have gone up, the milk of human kindness is in increasingly short supply around central London. "Even the atmosphere on this estate [of 214 flats] has changed," she says.

"Right up until the Sixties, there was only one bathroom on each landing, and four flats would have to share it. On bath night [Fridays], each family would take it in turns, and knock on your front door when they'd finished. When Peabody put baths in everybody's flats, it really altered the atmosphere; the old girls used to complain about how isolated they felt - how much they missed meeting and chatting on the landings."

One thing that hasn't changed, though, is the cheapness of the rent. "It's £79 a week, which isn't bad for Covent Garden, is it?" beams Mrs Duke. "Mind you, I can remember when it was six shillings and fivepence."

Although unbothered by the bustle of town, Mrs Duke is not that keen on the rough sleepers and drunks who sometimes convene in the central courtyard - nor does she approve of the way in which the estate has had its resident caretakers removed. That said, she wouldn't live anywhere else.

"I married a Canadian and made the mistake of going out there just after the War," she says. "Worst mistake I ever made. Within six months, I was desperate to be back here, and within a year I was. My husband was a bit annoyed at first, but when he got here, he loved it too. Who wouldn't?"

The Peabody Trust, 45 Westminster Bridge Road, London SE1 (020-7928 7811; www.peabody.org.uk). The Trust operates a variety of schemes for key workers, including low-cost halls of residence and sub-market-rate rented housing (£125 per week for a bedsit, £165 for a two-bedroom flat)