First time buyers will be able to benefit from discounted new homes under a new ‘First Homes’ scheme proposed by the Government.
The Ministry of Housing, Communities and Local Government has launched a consultation into the scheme which will allow first time buyers the opportunity to purchase a new build home in their local area at a 30% discount. Key workers providing frontline public sector services including health, education and community safety will be given priority, along with serving members and veterans of the Armed Forces, and local authorities can choose to set higher discounts if they want to.
Jackie Bennett, director of mortgages at trade body UK Finance, said: “Buying a home locally can be a big consideration for house buyers, but sometimes the prices are simply out of reach. The First Homes scheme is a great initiative by the government to fix this problem and we are looking forward to working with them to finalise the details and help house hunters become homeowners – in their own neighbourhood.”
Discounts must be passed on
Homes sold under the scheme will be independently valued to ensure buyers receive a genuine discount to comparable homes on the open market.
The discount must be passed on by the homeowner, so if they purchased the property with a 30% discount, they must offer the same 30% discount off the market price when they come to sell. This is so that there will always be homes available below market price and local communities will benefit for generations to come.
Homes purchased under the First Home scheme won’t be eligible for support under the government’s Help to Buy equity loan, which is designed to help those with small deposits get onto the property ladder. Buyers of First Homes will not be allowed to use them as holiday homes or buy to let properties.
Further details on the First Homes scheme will be announced later this year.
Government announces new build discounts for first time buyers