First-time buyers in England may be offered 50% off homes through a new government scheme which aims to help more people get on the property ladder.
Depending on your eligibility, you may be offered 30-50% discount on the purchase of your first home if you are a first-time buyer or a key worker. The scheme was launched to help people who are struggling to get on the property ladder in their local area and kicked off in Derbyshire in June. More locations will take advantage of this scheme in the coming months with an additional 1.5K homes joining the scheme later in the year.
How Does It Work?
Under the First Homes scheme, a percentage of new built homes will be offered to first-time buyers who can meet the criteria for eligibility. These homes will be sold with 30% discount of the open market price as a minimum, and in some cases the discount could rise to 40% of even 50%. If you are to sell the property, the same discount will be applied for the next buyer who will be purchasing the property under the same eligibility criteria. This is to ensure the homes are always available to the local community below their market value.
Prices for the first sale are capped at £250K after the discount has been applied, and rising to £420K in Greater London.
Lenders such as Halifax and Nationwide have agreed to provide 95% mortgages on homes being purchased under this scheme.
Who Will Be Eligible?
The First Homes scheme will be available to first-time buyers in England who are either:
- Key Workers
- Armed Forces
Key workers include doctors, nurses, teachers, delivery drivers, and supermarket staff. Local councils will be able to prioritise homes for key workers who have provided support for their communities during the COVID19 pandemic, as well as people in professions considered essential to the local area. Local authorities can also set connections to those people under special circumstances who must live in the local areas such as caring for loved ones or relatives.
The scheme is also open to all members of the Armed Forces including divorced, separated, or widowed spouses, and veterans who apply within 5 years of leaving the forces.
When it comes to buying as a couple, both of you must be first-time buyers, and have an annual income less than £80K, rising to £90K in Greater London.
50% of the property (at least) must be purchased through a mortgage.
We think this is an excellent idea for people involved in their local communities to be able to jump on the property ladder, and look forward to more areas rolling out the First Homes scheme!