Scheme aims to help first-timers break into prop­erty mar­ket

Yorkshire Post - Property - - FRONT PAGE - Sharon Dale

THE Gov­ern­ment-backed New­buy Guar­an­tee scheme launched this week will pro­vide a ma­jor boost for those who need it most, ac­cord­ing to Rightmove.

The sur­vey found that just un­der two in ev­ery five first-time buy­ers be­lieve that it means they are more likely to get on the prop­erty lad­der within the next 12 months.

It also looks set to ben­e­fit “sec­ond-step­pers”, those look­ing to sell and trade up for the first time.

The scheme will give buy­ers ac­cess to 95 per cent mort­gages on newly-built homes cost­ing up to £500,000, which means sav­ing for a de­posit won’t be a ma­jor bar­rier to pur­chase.

Banks, which have been de­mand­ing de­posits of be­tween 10 and 20 per cent, have been per­suaded to lend as the risk on New­buy mort­gages will be un­der­writ­ten by par­tic­i­pat­ing de­vel­op­ers and the gov­ern­ment.

The Coun­cil of Mort­gage Lenders say Bar­clays, Na­tion­wide Build­ing So­ci­ety and Natwest Home Loans Ltd are tak­ing part in New­buy and Hal­i­fax and San­tander have an­nounced plans to join the scheme.

Natwest has the low­est priced deals, of­fer­ing a two-year fixed rate up to 95 per cent LTV at 4.29 per cent plus a five-year fixed rate at 4.99 per cent.

Rightmove di­rec­tor Miles Ship­side says: “We’ve found that rais­ing a de­posit has long been the ma­jor ob­sta­cle for those look­ing to pur­chase a new home at the foot of the hous­ing lad­der. New­buy helps ad­dress this chal­lenge.”

“First-time buy­ers and sec­ond-step­pers have long been frus­trated in their ef­forts to get onto or move up the hous­ing lad­der by pro­hib­i­tive de­posit re­quire­ments New­buy opens the door to these groups and can also serve as a great stim­u­lus to help safe­guard and cre­ate jobs in the new build prop­erty sec­tor.”

Dacre, Son and Hartley’s new homes di­rec­tor John Shaw adds: “As the av­er­age age of first-time buy­ers is now es­ti­mated to be 37 in some parts of the UK and with ris­ing rents mak­ing it dif­fi­cult for first-time buy­ers to save for a de­posit, any scheme that makes a first home more af­ford­able must be wel­comed.

“Feed­back from the de­vel­op­ers that we rep­re­sent is al­ready very pos­i­tive as this scheme will help to pro­vide a vi­tal kick-start for small and large house builders who will be able to build homes and cre­ate jobs in the re­gion.”

The Home Builders Fed­er­a­tion said that 130 builders of all sizes had reg­is­tered in­ter­est in par­tic­i­pat­ing.

Many big de­vel­op­ers are tak­ing part in the scheme, in­clud­ing Bo­vis, which is of­fer­ing New­buy at Holmes Meadow in Selby, The Land­ings in Hook, Broad Oaks in Hemsworth, Mar­mav­ille Manor in Mir­field, Rams­den Clough in Wals­den and The Pines and The Elms and Hud­der­s­field. Per­sim­mon, Redrow, Bell­way, Tay­lor Wim­pey and Bar­ratt, along with Lin­den Homes, Crest Ni­chol­son and Miller are also tak­ing part.

Mark Clare, chief ex­ec­u­tive of Bar­ratt De­vel­op­ments, says in­ter­est is high. “Nearly 20,000 po­ten­tial home­buy­ers from all around Eng­land have pre­reg­is­tered their in­ter­est on the com­pany’s web­site, with the weekly reg­is­tra­tion rate now hit­ting 1,500.”

Although the scheme has been wel­comed by many, oth­ers feel it dis­crim­i­nates against older prop­er­ties.

York-based Kevin Hollinrake, man­ag­ing di­rec­tor of Hunters Prop­erty Group, says: “It is dis­ap­point­ing that this new scheme, as with other sim­i­lar ini­tia­tives, is only aimed at new homes, rather than the re­main­ing 90 per cent of peo­ple who want to sell or buy a home in the re­sale mar­ket. The Gov­ern­ment has quite rightly iden­ti­fied that rais­ing the de­posit is the big­gest bar­rier to en­try for those wish­ing to en­ter the hous­ing mar­ket, yet at the same time they are rein­tro­duc­ing Stamp Duty on prop­er­ties be­tween £125,000 and 250,000 for first-time buy­ers. The Gov­ern­ment is giv­ing with one hand and tak­ing away with the other.”

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