Govt launches First Homes scheme

The government has introduced discounted homes for key workers and local residents through its launch of the First Homes scheme.

The First Homes scheme aims to help local first-time buyers onto the property ladder by offering homes at a discount of at least 30% compared to the market price.

That same percentage will then be passed on with the sale of the property to future first-time buyers.

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This means homes will always be sold below market value, in order to benefit local communities, key workers, and families.

According to the government, the initial First Homes properties went on the market today as part of the first phase of an early delivery project in the Bolsover district, East Midlands.

A further 1,500 will enter the market from the autumn, with at least 10,000 homes a year being delivered in the years ahead and more if there is demand.

Delivery of the scheme is part of the government’s wider pledge to build one million new affordable and attractive homes in this Parliament.

Halifax, Chorley Building Society, Darlington Building Society, Leeds Building Society, Mansfield Building Society, Nationwide Building Society and Newcastle Building Society are the seven initial lenders supporting the scheme.

Housing Secretary Robert Jenrick said: “Enabling more people to buy their own homes is at the heart of the mission of this government, and First Homes will offer a realistic and affordable route into home ownership for even more people who want to own their own home.

“Thanks to First Homes, we will offer more homes to local people and families, providing a route for first-time buyers to stay in their local areas rather than being forced out due to rising prices.

“First Homes will also support our fantastic key workers who are looking to get their first foot on the housing ladder – from front-line doctors and nurses to delivery drivers and supermarket staff – by giving many of them the chance to buy a home at a 30% discount.

“These homes will be locked in for perpetuity to first-time buyers and key workers from their local area – making them an asset to both their owners and the wider local community.”

Andrew Haigh, chief executive at Newcastle Building Society, added: “Home ownership can often feel out of reach for first time buyers – especially those without access to the bank of mum and dad.

“We’re committed to delivering innovative ways to help first time buyers find affordable and sustainable ways to own their own home.

“We’re pleased to be one of the first lenders to support the scheme.”

Tim Bannister, director of property data at Rightmove, said: “There’s likely to be a scramble for properties under this scheme as they become available, especially as we’ve already seen an influx of first-time buyers enter the market recently, helped by more lower deposit mortgages being available.

“The scheme could help level up the playing field for buyers in areas where there’s strong competition between first-time buyers and buy-to-let investors, and could help some people bring their plans forward or buy a bigger home than they were originally expecting to.

“Based on current available stock levels it’s unlikely there will be enough of these properties to satisfy the high levels of demand, so eligible buyers will need to get in quick to have the best chance of securing one.”

Robin Fieth, chief executive of the BSA, added: “Building societies have always been dedicated to bringing home ownership within reach for as many people as possible, which is why we are working with the sector to help bring forward mortgages for First Homes as soon as possible.

“Building societies, both large and small, are pleased to be among the first lenders to offer mortgages in support of this new product.”