Scheme Gives First-time Home Buyers 20% Discount
As part of the governmentís ìstarter homesî plan, people under the age of 40 and looking to purchase a home for the first time can now get up to 20% off the original price. It is an initative which looks to grow the ownership of homes in England and promotes construction on ìbrownfieldî sites.
As part of the initative the government is planning to have 100,000 new houses available to first-time buyers by 2020. They will be able to offer the 20% discount by removing local authority charges for those constructing the houses. However, this only pertains to homes costing a minimum of £45,000 per dwelling on the aforementioned ìbrownfieldî land.
Further to the announcement, the government pledged that these homes would not be less energy efficient nor would the quality of the homebuilding suffer in anyway. However, if the first-time buyers sold their house within five years they would be forced to pay back the 20% discount.
The iniative is partly a response to the recent news that home ownership in Britain had plummeted to the lowest level it has been at in 29 years. The hope is to reverse the trend of young people being priced out of the market, a phenomenon that has been prevalent over the last twenty years.
David Cameron commented on the scheme: ìWe want to help people who work hard and want to get on in life but have been priced out of the housing market. A 20% discount off the price could be a real game-changer for many aspiring home-owners. My message is clear: we are on your side and we will help you fulfil your dream of buying your first home.î
A number of other government figures have spoken positively about the plan. Eric Pickles, the Communities Secretary, said: ìThe number of first-time buyers is already at a seven-year high and these starter homesÖwill help even more people realise their dream of home ownership.î
Moreover, Brandon Lewis, who is the minister for housing, stated: ì[The] new starter homes programme is another 100,000 homes on top of everything else that weíre doing, allowing those first time buyers, people who want to own that home of their own, to be able to do that- a good design, well-built home, with a 20% discount. When you link that with ëHelp to Buyí it opens up the ability to own a home to a whole new group of people.î
However, Labour have criticised it for being an empty pledge and that prices are still too high to allow the younger generation to get on the ladder. They argue that this government has overseen a situation whereby home ownership is at the lowest level for three decades and that house building has been at the lowest rate since the 1920s.
Emma Reynolds, the shadow housing minister rebutted: ìWarm words from David Cameron will ring hollow for those young people and families who have been priced out of home ownership over the past five years.î
She went on to argue that: ìThere is also a record number of young people living at home with their parents in their twenties and thirties.î