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Government to offer 30% discount on some new build homes

Posted: 11th March 2020   In: Residential Conveyancing

The government is planning the cut the cost of some new homes by nearly a third to help first-time buyers on to the property ladder.

The First Homes scheme will lower deposit and mortgage requirements for local first-time buyers in England. It’s hoped that people will be able to buy a home in their area, rather than be forced to look elsewhere because of rising prices.

The discount will only apply to a proportion of new homes, with the government consulting on exactly how many and how the scheme will be delivered.

Veterans will be prioritised as part of Armed Forces Covenant and councils will also be able to use the scheme for front-line workers in their area such as police, nurses, prison officers and teachers.

First Homes will see the discount locked into the property to ensure more first-time buyers benefit in years to come.

Housing Secretary Robert Jenrick MP said: “I know that many who are seeking to buy their own home in their local areas have been forced out due to rising prices. A proportion of new homes will be made available at a 30% market discount rate.

“The discount will be passed on with the sale of the property to future first-time buyers, helping thousands more people in years to come and ensuring local communities can stick together.”

The average price of a newly built home in England is £314,000. Under First Homes, a property sold with 30% off this price would deliver a £94,000 saving and enable first-time buyers to get on the ladder faster by taking more than £18,000 off a 20% deposit.

The government says it’s committed to delivering more than one million new homes over the next five years to further improve the affordability of housing.

The latest figures show the number of first-time buyers reaching 357,090 – an 11-year annual high and an increase of 84% since 2010 – and the percentage of home owning 25 to 34-year-olds has grown from 36% to 41% over the last 5 years.

The government is now conducting a public consultation on the First Homes scheme.

We shall keep clients informed of developments.

Please contact Eugene Pritchard or Gary Baber if you would like advice about the legal aspects of buying or selling a home.

Posted by: Eugene Pritchard
Residential Conveyancing
Luton Office