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Government reveals first time buyer help

Government reveals first time buyer help

Category: Mortgages

Updated: 21/11/2011
First Published: 21/11/2011

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The Government has unveiled a raft of measures aimed at reigniting the housing market and helping first time buyers.

Chief amongst the proposals is the launch of a new build mortgage indemnity scheme which it is hoped will help 100,000 prospective buyers who are currently frozen out of the housing market because of the need for large deposits over the next three years.

Under the proposals, homebuyers in England will be able to secure loans on new build properties with only a five per cent deposit.

The Government will provide security for the loan, so if the house is then sold for less than the total outstanding mortgage the lender will be able to recover its loss.

At the same time, the Government will reinvigorate the Right to Buy scheme in an attempt to give social tenants a greater chance of being able to buy the home they live in.

Under the scheme, the discounts are to be improved dramatically, and will be up to half the value of the home.

A commitment has also been made to build a new affordable home for every one sold under the Right to Buy scheme.

Elsewhere amongst the plans, the Government wants to bring more empty homes and buildings back into use.

£100 million of funding has been set aside for community-led initiatives and changes to council tax, alongside changes to make it easier to convert from commercial to residential property.

Tackling the 700,000 empty homes across the country will be a key feature in the drive to increase the provision of affordable housing, with councils and community groups being able to apply for funding to pioneer housing schemes.

The schemes will be backed by cash rewards for councils bringing empty homes back into use.

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