Government Help for First-Time Buyers

First-time buyers struggling to get onto the property ladder can be expected to pay an average of £150,000 for their property, approximately £30,000 higher than most first-time buyers budget for.

According to Stephen Leonard the director of mortgages at Alliance & Leicester, “First time buyers should take a look at the market in the areas that they plan to buy. Although they need to keep their costs low, first time buyers should perhaps reconsider their budgets. The majority are looking for a house under £120,000 but realistically they may need to be looking closer to £150,000."

However help may be at hand. The government has announced new plans to create more affordable homes aimed at first-time buyers.
These include

• extension of state sponsored shared-ownership schemes.
• state-owned land is to be sold off to developers on the understanding that a proportion of the homes they build will be affordable to first-time buyers.

The state sponsored ownership scheme will be a government-backed, shared-equity programme, which could see first-time buyers having to raise as little as half the house price. The other half of the house price will be funded by housing associations.

The Chancellor said: "It means that people who couldn't afford the full price of a home can afford the partial price, and they can gradually ramp up their stake.

The mortgage lender Halifax welcomed the scheme, saying: "The housing market depends on first-time buyers. Without them, it slows down, so initiatives like this are very, very good."