MSE News: Government house buying scheme launched

Former_MSE_Helen

This is the discussion thread for the following MSE News Story:

"The NewBuy Guarantee scheme could help 100,000 people buy a new-build home with a deposit of 5% or 10% ..."

Read the full story:
Government house buying scheme launched

brit1234

Newbuy is a con designed to assist the builders not the public. It sells new builds in a falling market at an inflated price with just a 5% deposit. You will be put in instant negative equity and trapped from in the future steps up the ladder.

This scheme is designed to focus on gullible or desperate people who don't realise the consequences. To make it worse the tax payer is exposed to the debts if the properties are repossessed.

zag2me

Yep similar thoughts to the above.

Why encourage 5% deposits? Thats asking for trouble.

Imagine what is going to happen when interest rates rise again. Its unsustainable and just building a bubble again.

RenovationMan

Anything that helps youngsters buy their first house has got to be a good thing. Not everyone has BOMAD to assist them in their first purchase.

GaryC_3

Anything that helps youngsters to plunge into debt 6 times greater than their annual income, to pay over-the-odds for a depreciating asset that costs to build 2 times their annual income has got to be a good thing.

brit1234

RenovationMan wrote: »

Anything that helps youngsters buy their first house has got to be a good thing. Not everyone has BOMAD to assist them in their first purchase.

Surely that statement has to have limits. I would say tricking first time buyers into overpaying and risking instant negative equity is not a good thing. You can bet the newbuild sales person won't point out the risks as well.



People should be encouraged to save their deposits, this scheme is designed to prop up builders prices as they can't sell them.

RenovationMan

What is the alternative for youngsters who want a secure home for their children and don't have access to the Bank Of Mum And Dad?

Many young families are living in rented family accomodation at rents that far exceed the equivalent mortgage rates and leave them with little or no money with which to put a large deposit together. They don't have security of tenure and they don't want to keep moving their kids from school to school whenever their BTL landlord decides to sell up/go bust.

brit1234

RenovationMan wrote: »

What is the alternative for youngsters who want a secure home for their children and don't have access to the Bank Of Mum And Dad?

Cutting out goings, do a little over time, missing the odd holiday and saving a deposit. That's what I did and that is what generations of people have done before me.

Deposits are so high as the banks believe these over priced houses are going to fall in value. It's there hedge, that why lower deposits have higher costs due to the increased risk.

daska

If it were truly for the benefit of first time buyers it wouldn't be limited to newbuilds.

shortchanged_2

RenovationMan wrote: »

What is the alternative for youngsters who want a secure home for their children and don't have access to the Bank Of Mum And Dad?

Lower, more sensible house prices??

vzbfhr

Sorry Brit I disagree.

I for one am eagerly awaiting more news on this scheme. Due to a new addition to the family i need to move house NOW and don’t have time to save for a deposit.

I understand that i may have to pay higher interest at the start until we can change, but this is perhaps the only way i can move pretty soon.

So what I’m trying to say is, if the situation calls for it, this is another option that is at least available for people to look at if needed.

Surely its better to have this option then without?