What help is on offer for first time buyers?
PUBLISHED: 14:43 06 August 2018 | UPDATED: 14:43 06 August 2018
What help is on offer to encourage first time buyers to take the first step onto the property ladder? Edward Parker, managing director of Bennett Homes, discusses.
According to recent figures from UK Finance, the number of first-time buyers taking out a mortgage rose by 8.1 per cent in May, indicating that conditions are more favourable for this segment of the market.
So what help is on offer to encourage them to take the first step on the property ladder? The report highlights that 365,000 first-time buyers completed on a mortgage in 2017, the highest number since 2006. There’s no doubt that the government’s Help to Buy Scheme which is scheduled to run until 2020, is a great help to this group who may need assistance in raising the deposit. The scheme requires buyers to make a personal contribution of just 5 per cent and is available on new homes up to a maximum purchase price of £600,000. Helping with the deposit up to a maximum of 20 per cent also enables buyers to access more attractive mortgage deals. Other ways to help all buyers, but probably particularly of interest to first-time buyers, is purchasing your new home on an equity share basis. This means that buyers fully own their own homes by taking out a mortgage covering 75 per cent of the property value and then have the opportunity to buy the remaining 25 per cent equity share at current market value after five years. No rent is payable on the 25 per cent equity share which will be retained through a legal charge, held by a third party on an interest free basis. The advantage of this is that unlike shared ownership schemes, no fees or interest is payable, neither is there a repayment deadline as there is with Help to Buy after which interest is charged. As a company we are currently offering this opportunity on our Saxon Green development at Ashill and at The Signals at Watton. At Saxon Green, buyers can purchase a two bedroom apartment which includes a shared rear garden and two allocated parking spaces, as well as a range of features included in the price.
At The Signals there is a range of properties to purchase on an equity share basis including two, three and four bedroom houses.
You can contact Edward Parker at Bennett homes on 01284 766057 www.bennett-homes.co.uk
Bennett Homes has sponsored this column.