In recent years, the UK government has introduced a wave of policies and support for first-time buyers in an aim to increase homeownership – and they’re working.
New research has shown that one-third of all houses sold so far in 2024 have been bought by first-time buyers.
What support is available to first-time buyers?
In addition to falling mortgage rates over the last 6 months, first-time buyers are privy to additional support and schemes set out by the government.
One of these schemes is the First Homes scheme. The aim of this scheme is to limit the number of first-time buyers having to move away from their local area by offering a 30% discount on new-build homes. The scheme saves eligible first-time buyers an average of £100,000 and greatly reduces the deposit and mortgage requirements.
Working in conjunction with the First Homes scheme is the government’s push to build new homes and make them affordable – especially in areas with high demand such as London.
Another scheme that is helping first-time buyers is the Help to Buy ISA. It is no longer possible to open a Help to Buy ISA, but if you already have one, the government will top-up any funds you have in it by 25% (to a maximum of £3,000) in order to purchase a first home. If you have a Help to Buy ISA, your solicitor or conveyancer will apply for the extra 25% for you.
New support is being introduced
The government continues to create new housing schemes and introduce new policies to support more people in becoming homeowners. To keep up to date, we recommend regularly checking a one stop shop for news and information in the housing market such as https://www.samconveyancing.co.uk/news.
The government is regularly reviewing their strategy to improve the housing market. Recently, they introduced an extension of the Right to Buy scheme first introduced by the Housing Act 1980. This scheme gives local authorities the ability to sell council houses to tenants in a bid to increase home ownership.
This scheme has recently been widened to include housing association tenants. In addition, the government has reformed the way Universal Credit is applied to housing and has added the option for it to be paid towards a mortgage instead of directly to a private landlord or housing association.
There is also the possibility of 1% mortgages being introduced as the government continues to consider new ways to reduce the initial financial barrier to home ownership. As of yet, these mortgages are offered by specific housing developers and are not a government scheme, but this may change in the future.