The government have announced further help to first time buyers as the push to combat the homeownership decline continues. The scheme aims to offer those who have not been able to buy their first home the opportunity to build it, with 5% deposits made available and backed by £150 million of government funding. Other than providing new first homes for those unable to get on the property ladder, the scheme has also been designed to boost the self and custom build sectors, support SME builders while creating new jobs in the construction industry.
The construction industry and first-time buyers were given a boost recently as the government launched the new help-to-build scheme. Announced by the Department for Levelling up, Housing and Communities, the new scheme will allow 5% deposits on land and building costs on new Helpto-Build mortgages. With £150 million of government backing behind the scheme, first time buyers will now be able to access self and custom designed homes with a much more affordable initial deposit – with the previous average for deposits on these mortgages around 25%. The change will mean that first-time buyers will no longer be priced out of building their first homes.
As of June 27th, applications were opened for the new scheme. The scheme will help to “level up communities” by supporting young people and families into homeownership in the areas they wish to live. The scheme is also part of the government’s plan to boost the UK’s underdeveloped self and custom build sector, creating jobs, increasing the number of new homes and helping to grow the economy. In response to Richard Bacon MP’s independent review of scaling up custom and self-housebuilding, the government have set out how the new scheme could deliver 30,000 – 40,000 new homes a year.
Speaking on the government’s response to his report, Richard Bacon MP said: “I am very pleased by the government’s warm response to my review. The government recognises the crucial role which custom and self-build housing can play in addressing the nation’s housing challenges, including delivering more affordable housing. Making it easier for people to build or commission their own homes helps to promote a more diverse housing market with more real choice and control for consumers.
There is clear evidence that getting people more involved in decisions about housing helps to deliver houses that are better designed and better built, which are greener and cost less to run and which communities are happier to see built. I look forward to working with the government to progress this important agenda”.
Help-to-Build will offer a welcome boost to the self and custom build sector. It could also set a trend of self-build homes becoming more popular and in turn create a reliable and sustainable flow of work within the sector for years to come. As the levelling up efforts are continued, the new Help-to-Build scheme becomes the latest attempt to turn ‘generation rent’ into generation buy’, as the government tries to counter the historically low homeownership rates amongst younger people.
