New scheme offers first-time home buyers 20% discount
New homes are to be offered at a minimum 20% discount to first-time buyers under the age of 40.
The Starter Home initiative is a government scheme to help young people on to the housing ladder and encourage construction firms to build more homes. It’s hoped that up to 100,000 buyers will benefit.
The initiative is being made possible by a change to the planning system. The idea is to eliminate or reduce planning costs and levies on under-used brownfield sites which are suitable for building new homes.
In return for the reduced costs, developers have to agree to sell the homes for at least 20% below market value so they are affordable to first-time buyers. The buyers are not allowed to re-sell the homes at market value for a fixed period – making sure that the savings are passed on to future buyers.
More than 30 developers have agreed to take part in the scheme and are now working with councils across the country to identify suitable brownfield sites.
Communities Secretary Eric Pickles said: “The 2008 housing crash blocked millions of hard-working, creditworthy people from becoming homeowners, at a time in their lives when they should have been able to expect to get on the property ladder.
“We’re turning that around with Help to Buy, but the new Starter Homes scheme will offer a further boost, giving young people (under 40) the opportunity to buy low cost, high quality new homes for significantly less than they would normally expect.”
The government is now running a public consultation on the scheme before finalising the details. We shall keep clients informed of developments.
Please contact Gary Baber or Dipak Odedra if you would like help with the legal aspects of buy and selling a home.