This week a new scheme giving hope to 100,000 would be first time buyers was announced by the Prime Minister. The new scheme will offer a 20% discount to first time buyers of new homes on selected purpose built brownfield developments.
House builders and councils are already assessing sites that could be used for these new homes as aspiring home owners are invited to register for the Starter Home Initiative from the beginning of 2015, at least six months earlier than initially planned.
The Starter Home Initiative breathes even more optimism into the prospects of the 2015 housing market, following on from the stamp duty changes in the Autumn Statement.
Prime Minister David Cameron commented, “This is all part of our long-term economic plan to secure a better future for Britain, making sure we are backing those who work hard and get on in life.”
Changes in the planning system to reduce planning costs and levies from brownfield sites which would otherwise be under-used or unviable, will facilitate the delivery of new homes at a below market value sale price.
“Increasing housing supply is a huge and complex challenge and significant barriers remain. Bringing forward more land for house building, while also enabling more first time buyers to realise their ambition of home ownership would be another positive step on the way to tackling the housing shortage.” Commented Stewart Baseley of the Home Builders Federation, “The industry is keen to work with government to develop policies that would allow for more high quality homes to be built in the right places.”
The levies and costs, affordable housing and community infrastructure contributions charged vary between areas and districts, averaging £15,000 per home on average nationally. By waiving these costs on selected brownfield sites the savings can be passed on to the first time buyers.
The 100,000 starter homes will be available to first time buyers under the age of 40, starting in 2015. To make sure genuine first time buyers benefit, the homes could not be re-sold at true market value for a fixed period.
As well as delivering a reduced price product the initiative also specifies these new homes must be high quality and well designed to suit the needs of modern life. House builders who have pledged their support for the scheme include Barratt, Bloor, Cala, Linden, Persimmon, Taylor Wimpey and Bellway.
The Department for Local Communities and Governments consultation will run for 8 weeks (from 15th December). “Stepping onto the property ladder” covers the following key points:
- Planning for Starter Homes
- Making more brownfield land available for Starter Homes
- Prioritising young first time buyers
- Making the first time buyer discount more financially viable
- Encouraging good design for Starter Homes
- Identifying demand for Starter Homes
- Identifying vanguards to promote Starter Homes
Take part in the consultation. The government will work with the industry to develop a register that will allow prospective first time buyers to register their interest in owning a Starter Home from January 2015.