It was unveiled yesterday that the government is planning to build an estimated 200,000 new homes across 30 local authorities, each with a 20% discount to help first time buyers get onto the housing ladder.
The new ‘Starter Homes scheme’ is being rolled out across many locations in Britain, and property developers will be tasked to build these new affordable homes ready for 2018.
How much will it save?
The 20% discount will be available to first time buyers aged between 23 and 40, on properties costing a maximum of £250,000, or £450,000 within London’s limits. This could see buyers saving up to a huge £50,000 countrywide, or £90,000 on a property in the capital.
This comes as great news to first time buyers, as the government’s Help to Buy scheme seems set to finish in the near future. Young families and couples can now hope to buy their own home in a number of places at a big discount.
Where can I buy a Starter Home?
The list of 30 local authorities where you will be able to buy a Starter Home covers the entire country and includes such areas as Blackpool, Bristol, Sussex and Manchester. The scheme will also include several new-build properties in London, for those who wish to work in the capital.
The houses will be built on former brownfield sites, meaning that industrial work used to be carried out on the land. There are many of these brownfield sites around the UK which would provide great places to build new housing complexes, of which the country is greatly in need of.
Are there any catches?
As with a lot of good news, there are some drawbacks. When you buy a home under the Starter Homes scheme, you’ll have to live in it for at least five years, and you won’t be able to sell during that time.
When you do come to sell, you may need to pay the 20% back, though you won’t have to sell the property on at the same 20% discount that you received, which is good news for sellers, but not so good for future buyers.
Why do we need Starter Homes?
Since 2007, the number of new homes being built in the UK has dropped by nearly 40% from 177,650 to 106,720, leaving many young families and couples stuck in the rental sector.
Since last year’s decrease to the national interest rate, mortgages have become more affordable, so hopefully this new scheme will be able to address the UK’s fluctuating housing crisis – we will see in 2018.
To enquire about buying property on the Starter Homes scheme, or if you are a first time buyer in need of some guidance, give our friendly team a call on 0800 038 6446 or apply for a free instant quote.