We’re slowly being given additional snippets of information on the government’s new-build mortgage indemnity scheme, or what it refers to as the NewBuy Guarantee Scheme.
After a big fanfare last November, the first state-backed mortgage indemnity scheme is set to be officially launched next month. It aims to help 100,000 homebuyers who have only a five per cent deposit to purchase a new-build property – an initiative aimed at getting the housing market moving again.
Today, Grant Shapps, the housing minister, revealed the scheme will be available to homebuyers purchasing new-build houses and flats up to the value of £500,000 – a higher price than most in the industry expected. This will be good news for first-time buyers in London, where the average price of properties is much higher than the rest of the UK, and also for existing homeowners looking to move up the property ladder.
Mr Shapps also confirmed that it would be open to all buyers, not just first-time buyers, as long as they are UK citizens and are buying the property as their main home. Sorry to all you landlords out there.
However, that’s all the information we have. We still don’t know how these mortgages will be priced. Or even whether lenders will be able to price them at more competitive rates than existing 95 per cent deals currently available in the market.
What’s your view on the NewBuy scheme? Will it help get things moving in the housing market?
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