Housing Minister Proposes 1,500 Grant To Help First-Time Buyers
by
Sarah Othman
Housing Minister, Caroline Flint and Prime Minister, Gordon Brown, have recently announced a new package of major measures to tackle the difficulty key workers and first-time buyers have been facing when trying to break into the property market. The options available to first time buyers will include a housing grant of 1,500. However, only those who take up a shared equity loan under the governments new Open Market Homebuy scheme (OMHB) will be eligible for the grant.
Treasury ministers and the housing minister will be working with the Council of Mortgage lenders in order to discover what can be done to help first-time buyers, while also maintaining their obligation to treat all consumers fairly. The proposed grants are intended for key workers who take up the new scheme and will help to supplement the buyers home loan by paying for solicitors charges, furniture and other associated costs.
In an article firstrung.co.uk the Prime Minister said: “We want to do more for people who may need an extra hand to buy their first home. By offering new grants and sharing a stake in their home, we are making the dream of a new home more affordable for thousands of low-income first time buyers and key workers such as nurses and teachers.”
More than 3 million pounds has been set aside for the first wave of OMHB grants. The scheme is expected to boost key workers buying power so that a buyer with a total yearly income of 32,000 could afford a house which costs 200,000. And, they would be paying 760 a month in mortgage repayments instead of the 1,350 they would have to pay without the scheme.
The OMHB schemes, which are now available, are aimed at key workers and priority groups such as social tenants and some first-time buyers. One of the schemes is called My Choice Homebuy, which is a loan of between 15% and 50% and can be taken out as a supplement to a mortgage. The other scheme is called Own Home and this is an equity loan which is worth between 20% and 40% of the propertys purchase price, again this can be taken out in conjunction with an ordinary mortgage product. Both of these schemes are part funded by the government.
The Government also intends to build more housing to support the new plans. 30,000 new homes should soon begin construction on areas which are former public sector sites including disused land and old coal fields. The new homes will also be 25% more energy efficient than those previously built by the government. The target that Caroline Flint and Gordon Brown intend on hitting is 200,000 new homes by 2016.
A quote by the Housing Minister on the matter is also on firstrung.co.uk, she said: We urgently need to meet the challenges of building more homes. Our plans for public land, and tougher building regulations, mean we can deliver the homes our young families and first time buyers desperately need, whilst protecting and maintaining the environment. It is important that we look at what more can be done to support households most at risk from the impact of the global credit crunch, working closely with the Council of Mortgage Lenders.”
Sarah Othman is an author of several articles pertaining to
Secured Loans
. She is known for her expertise on the subject and on other Business and Finance related topics.
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Housing Minister Proposes 1,500 Grant To Help First-Time Buyers}