FirstBuy scheme announces 100 successful bidders
Thursday 23rd June 2011
More than 100 house builders and housing associations have been successful in their bids to participate in the FirstBuy scheme.
Under the scheme they will be jointly funding an equity loan of up to 20% with the Homes and Community Agency to help first-time buyers purchase a new home.
A total of £180m has been allocated over the next two years to provide almost 10,500 homes under the scheme.
It is expected that the first will be available for sale from September.
Successful bidders include Barratt, Bovis, Persimmon, Taylor Wimpey, Crest Nicholson and Fairview New Homes.
Participating lenders will include Halifax, Nationwide, and Barclays.
First-time buyers with a maximum income of £60,000 will be able to apply for help under the scheme, provided they can raise a 5% deposit and the property has a maximum value of £280,000.
The Government and participating developers will together come up with the remaining 20% to make up a 25% deposit.
The 20% will be in the form of a loan, interest-free for the first five years, then charged at 1.75% in the sixth year and RPI inflation plus 1% after that. Loans are repaid when the property is sold, or after 25 years, with a 20% proportion of any profit going to the Government and developer.
The scheme has come under fire from some quarters as being good for developers but not such a good deal for first-time buyers. Estate agents have also questioned its values, because it is restricted only to new homes that have a price premium.
But one participating developer said there has already been substantial interest from first-time buyers.
Ian Baker, group managing director for Linden Homes, part of the Galliford Try Group, said: “The funding will sustain housing supply, create jobs within the construction industry and, crucially, help a pool of first-time buyers. We have already seen substantial levels of interest in FirstBuy across all our regions, with a number of people registering on our website for information.
“However, while FirstBuy is helpful, figures show that lenders still remain overly cautious, and until they relax lending criteria, the onus will fall on housebuilders to make up the shortfall.”
A full list of successful bidders and their allocations can be found at www.homesandcommunities.co.uk/firstbuy
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