The First Homes initiative has now been launched in England first time buyers will be able to apply for a discount of up to 50% on a new-build home under the government scheme. On Friday 4th June, 2021 the first properties that went on sale with the discount was in Bolsover in the East Midlands, further sites across the country will be due to launch in the next coming weeks and months. The government has also said it will be funding a further 1,500 homes which will be available in the autumn and then has further plans to have at least 10,000 homes a year being delivered in the years ahead and will add more if there is a demand. Boris Johnson wants to introduce more affordable housing and to hit his target of building 1 million new homes by 2024.
Under the scheme some local authorities will be allocated some funding from the government which will then be used to subside developers and the sale of the homes at the correct discount. Local authorities will be able to offer a bigger discount at 40% or 50% if they can show a need for this to the government. There will be some price caps in certain areas after the discount has been applied the first home buyer cannot be required to pay more than £250,000 or £420,000 in Greater London. Only the local councils will be able to make the case for imposing lower price caps.
The scheme is for first time home buyers only, local councils will also be able to prioritise homes for local key workers such as NHS staff and those on the pandemic frontline such as delivery drivers, supermarket staff, nurses and teachers etc. It will be aimed at helping people get onto the property ladder by offering the homes at a discount of at least 30% compared with the market price. The scheme will support local people who struggle to afford market prices in their area, but want to stay in the communities where they live and work.
To help promote he new scheme the UK ministers have launched a “own your home” campaign, with prospective buyers able to log on to a new website to direct them to the scheme most suitable for them. If you decide to buy a house with scheme discount. When you do sell the property the discount will be passed on with the sale of the property to future first-time buyers, meaning homes will always be sold below the housing market value, thereby benefitting local communities, keyworkers, and families for generations to come.
The first homes new scheme initiative could save first time home owners £100,000 or more on their property. Some experts have said that with demand for these cut-price homes likely to exceed supply, it could spark a scramble for properties and add more fuel to the current house boom.
Tim Bannister, Rightmove’s director of property data, said: “There’s likely to be a scramble for properties under this scheme as they become available, especially as we’ve already seen an influx of first-time buyers enter the property market recently, helped by more lower deposit mortgages being available.”
Mr Robert Jenrick, Secretary of State for Housing said: ” Enabling more people to buy their own homes is at the heart of the mission of this government, and First Homes will offer a realistic and affordable route into home ownership for even more people who want to own their own home. Thanks to First Homes, we will offer more homes to local people and families, providing a route for first-time buyers to stay in their local areas rather than being forced out due to rising prices. These homes will be locked in for perpetuity to first-time buyers and key workers from their local area- making them an asset to both their owners and the wider local community.”
Those who can afford to buy a First Home without a mortgage will not be eligible, and there are measures aimed at preventing people buying the homes purely as an investment.