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Budget 2011: new £250 million scheme to help first time buyers
As predicted, the chancellor has confirmed that the government will use profits from the bank levy to help 10,000 first time buyers to purchase a newly built flat or house.
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A new £250 million equity scheme designed to help struggling first time buyers get on the housing ladder has been announced by George Osborne in the Budget.
As predicted earlier today, the chancellor confirmed that the scheme, which is called Firstbuy Direct, will use profits from the bank levy to help 10,000 first time buyers to purchase a newly built flat or house. It will replace Labour’s Homebuy Direct scheme which was withdrawn last autumn.
Buyers will have to put up a 5% deposit, the government and home builder will cover 10% each and then the remainder of the amount will be covered by a loan.
It is hoped the scheme will help protect up to 50,000 jobs in the construction industry.
The news comes less than a week after Lloyds TSB announced it had teamed up with local councils to help first time buyers raise a deposit for a house. Lloyds’ new scheme, ‘Local Lend a Hand’, will allow borrowers to put down a deposit of just 5% when they buy their first home, compared to the 10% deposit required by the majority of lenders.
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4 comments so far. Why not have your say?
Jonathan
Mar 23, 2011 at 14:00
No surprises here, the government trying another measure to prop up house prices. They could have just let them fall and correct themselves to a more normal price-to-earnings ratio which would mean first time buyers could afford them.
report thisIan
Mar 23, 2011 at 17:14
Jonathan is entirely correct. This is just a silly gimmick and is unlikely to have any impact. If the government allowed the market to correct itself the volume of sales would improve and the problem would fade away
report thisTHOMAS EAVES
Mar 23, 2011 at 17:16
What is the problem with current house prices!!!!!
When I bought my first house, I put down a deposit of circa 25%.
The government did't help me with it.
I went through the high interest rates in the 1990s.
If you ask me, the people who cannot afford to buy a house are better renting.
This is how it used to be.... pushing people into home ownersip when it only results in re-possession is folly!!!!
report thisAlan Tonks
Mar 23, 2011 at 18:41
Well Mr Osborne another well thought out strategy as usual, on how to prop up the builders and waste tax payers money.
I am only glad that the Duke of Wellington didn’t have your idea of strategy at Waterloo, or should I not mention the Duke and Waterloo, it might not be PC.
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