New first-time buyer scheme to be confirmed at Budget

The government has announced a new equity loan scheme - Your First Home - in England will be confirmed at next month’s Budget, to support more people into homeownership.

This is expected to support 2.5% deposits, backed by 20% government-backed equity loans, for prospective first-time buyers purchasing a new-build property from a developer signed up to the scheme. 

People will be able to access equity loans with an initial interest free period, meaning that those who use the scheme could save hundreds of pounds per month compared to a 95% mortgage. 

The Your First Home scheme will "help tackle the deposit barrier for first-time buyers who would be unable to afford their first home otherwise, building on the government’s existing work to help more young people and families onto the housing ladder." The scheme will also set a household income cap with local property price caps to further ensure support is targeted at those who need it, the detail of which will be set out at Budget.

With the new build housing market currently facing challenging headwinds driven by international economic pressures and rising construction costs, the scheme will also act as a much-needed stimulus to support the market and boost housing supply. Developers will be expected to make a contribution when signing up to the scheme to help cover costs.

Prime Minister Andy Burnham told the BBC: "Too many young people are struggling with the cost of housing, with many giving up hope of ever having a home to call their own. So we will step in to help more first-time buyers on to the housing ladder."

Mortgage lenders have changed the acceptance criteria in recent years to make it easier for first-time buyers to get on the property ladder. There are lots of low-deposit and income-stretch mortgages available.  

Call Trinity Financial on 020 7016 0790 to secure a mortgage, book a consultation, or complete our mortgage questionnaire. 

The information contained within was correct at the time of publication but is subject to change. It is for general information purposes and is not advice.

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