The boxed-in generation – people unable to upsize their home but who have also outgrown their first property – will for the first time benefit from support to help them move up the housing ladder, Grant Shapps said today.
In a speech to housebuilders, the Housing Minister argued that a generation of first time buyers and families with children are unable to do what their parents did and move homes as their needs grow.
A recent survey from Findaproperty.com found that almost a third of parents find their current home is too small to accommodate their family – rising to 40 per cent for younger families where the parents are aged between 18 and 34.
Government action to help the boxed in generation
Mr Shapps said that for the first time, these overlooked owners will now get the help they need to move from their current abode to a new address – through the NewBuy Guarantee – while also freeing up properties suitable for aspiring first time buyers.
The NewBuy Guarantee is not confined to first-time buyers but is designed to help anyone looking to buy a newly-built property – and is expected to help up to 100,000 prospective and current homeowners.
Through this innovative new scheme, instead of a typical buyer requiring a £40,000 deposit to buy a £200,000 home, they will now only need £10,000. The scheme – which had its first sale this week – is available for homes of up to £500,000.
Housing Minister Grant Shapps said:
“For years increasing numbers of people have outgrown their homes but been unable to move, and first-time buyers have been unable to buy.
“They know who they are. Hardworking people who bought their home when they were single, maybe met someone, fell in love and now have a couple of kids. They expected to trade up – because that’s what their parents were able to do. But now they’re boxed-in, home outgrown. Stuck in a flat, when really want they want is a family home.
“The NewBuy Guarantee will give our second-time buyers a second chance, as this is the first scheme of its kind not confined to first time buyers, but available to anyone looking to buy a newly-built home.
“We don’t want Britain to be a place of housing have nots, we want people to have room to grow. The NewBuy Guarantee will do just that.”
HomeBuilders Federation Executive Chairman Stewart Baseley said:
“Reducing the deposit needed for a new home to an affordable level is a fantastic opportunity for many people who have been for too long frustrated. It will also open up the market, creating work for house building companies large and small and boost the economy as a whole.”
A NewBuy Guarantee
Launched just six weeks ago, the NewBuy Guarantee is already starting to open up the market, with four lenders offering 95 per cent mortgages on new-build properties by up to nine leading housebuilders.
– Natwest, who offer 95 per cent Loan-to-Value mortgages at under five per cent interest on properties built by Barratt, Bellway, Bovis, Linden Homes, Persimmon, Redrow and Taylor Wimpey;
– Barclays, who offer 95 per cent Loan-to-Value mortgages on properties built by Barratt, Bellway, Bovis, Persimmon, Redrow and Taylor Wimpey;
– Nationwide, who offer 95 per cent Loan-to-Value mortgages on properties built by Barratt, Bovis, Bellway, Persimmon, Redrow and Taylor Wimpey;
– Halifax, who offer 95 per cent Loan-to-Value mortgages on properties built by Barratt, Bellway, Bovis, Crest Nicholson, Cala Homes, Linden Homes, Persimmon, Redrow Homes, and Taylor Wimpey
And over the next few weeks a number of other major lenders are expected to join the NewBuy Guarantee, working with a wide range of builders.