First-time buyers in England offered 20% discount on new homes

Bossworld

How does this work against the previous 20% equity loan scheme?

For example, a friend moved to a new build last month, with a 5% deposit and a 20% equity loan as part of help to buy. Hypothetically, let's say the house was on the market from the developer for £200,000. Would this mean that people on the new scheme would be buying for £160,000?

GoldenShadow

Bossworld wrote: »

How does this work against the previous 20% equity loan scheme?

For example, a friend moved to a new build last month, with a 5% deposit and a 20% equity loan as part of help to buy. Hypothetically, let's say the house was on the market from the developer for £200,000. Would this mean that people on the new scheme would be buying for £160,000?

That is how I am interpreting it. And if you sell within five years you're obliged to pass that same 20% discount onto other FTB. I wonder what happens if it isn't FTB you sell too, though. Maybe you would be restricted.

I wasn't ever that keen on using HTB, I'm curious to see how this pans out. In order to get on the housing ladder OH and I will have to move further away from London to be able to do it (we're in a home county already). Sadly, probably far enough that commuting would be too much for me to hack. I don't work in London at the mo, but career wise it would be sensible to do so in the next 2 ish years.

stator

I wonder how the mortgage companies will view this. Instant 20% equity? I doubt it very much.
As mentioned above I bet the vendros push prices up just to offer the fake 20% discount, much like Ford did with the scrappage scheme.

Jason74

carlx wrote: »

Wealthier people want to earn more money, to support their families and have a more comfortable life - in recent decades this has seen many people buying "Buy to let" properties, increasing demand and forcing out lower income earners. But this isn't our biggest problem.

True, but it's a pretty big problem nonetheless, and something that really needs to be addressed. Sadly, the political will just isn't there to deal with it at the moment (although I think that will change in the next decade or so as the extent of the problem becomes more obvious to more people), so for now, we will continue sleepwalking into even more of a two tier society all in the name of the "free market"

wymondham

Why is it only under 40's ? Are those 40+ not priced out also?

HAMISH_MCTAVISH

wymondham wrote: »

Are those 40+ not priced out also?

If you're over 40 and haven't bought a house, you've been of house buying and working age during some of the abnormally cheapest house prices relative to income in history in the mid 90's, you've had access to cheap mortgages and house prices at historically average multiples of income in the early 2000's, and you've had access to 100% mortgages that were cheaper than average rents in the mid 2000's.

If you still haven't bought a house through all that, you really have nobody to blame but yourself.

lukeh23

HAMISH_MCTAVISH wrote: »

If you're over 40 and haven't bought a house, you've been of house buying and working age during some of the abnormally cheapest house prices relative to income in history in the mid 90's, you've had access to cheap mortgages and house prices at historically average multiples of income in the early 2000's, and you've had access to 100% mortgages that were cheaper than average rents in the mid 2000's.

If you still haven't bought a house through all that, you really have nobody to blame but yourself.

Unless they had the misfortune of a divorce.

HAMISH_MCTAVISH

lukeh23 wrote: »

Unless they had the misfortune of a divorce.

Misfortune or bad judgement?

Regardless, for most in their 40's that are now "priced out", they are 'priced out' through choice.

They chose not to buy a house during three of the most advantageous times in history to do so.

Some even chose not to buy a house on the advice of random nutters on the internet who claimed a crash was coming and it made sense not to buy....:rotfl:

While ignoring the reality that history shows there is rarely a bad time to buy versus the alternative of renting....

Even those who took 100% mortgages in 2007, right before that last crash, are now on average many tens of thousands of pounds better off than those who chose not to buy and rent since.

For some, that figure is hundreds of thousands better off.

The lesson to be learned, for any not too blind to see, is that the best time to buy a house is as early in life as you can and trying to time the market is a mugs game.

Unfortunately, mugs are not known for their ability to learn lessons, so I don't doubt someone will pop up shortly to argue the point.

Graham_Devon

HAMISH_MCTAVISH wrote: »

If you still haven't bought a house through all that, you really have nobody to blame but yourself.

There could be hundreds of different reasons as to why someone hasn't bought a house by the age of 40.

Death, divorce, single with kids, kids who need more care, relatives who need care, learning disabilities, disability ........

I could go on....

Someone in my family has a child with severe downs syndrome. They have had to devote a lot of time to her, which means earning potential has been limited.

Would you say that putting the care of their child before maximum earning potential was bad judgement?

wymondham

HAMISH_MCTAVISH wrote: »

If you're over 40 and haven't bought a house, you've been of house buying and working age during some of the abnormally cheapest house prices relative to income in history in the mid 90's, you've had access to cheap mortgages and house prices at historically average multiples of income in the early 2000's, and you've had access to 100% mortgages that were cheaper than average rents in the mid 2000's.

If you still haven't bought a house through all that, you really have nobody to blame but yourself.

I still don't understand why this policy excludes over 40's?


This will be a right kick in teeth for those over 40 who have been trying to buy. Firstly the policies of the Government have contributed fairly largely to the problem of increased prices etc, then they exclude them from one of the 'solutions' ...


Its a rubbish idea anyway, and is another attempt to force fix something that should be left to correct itself (however unpleasant!)