Government scheme to boost new homes construction in Britain
12 March 2012
Posted by Michelle Devonshire
A new Government initiative has been unveiled aimed at increasing the number of first time buyers on the property ladder.
Entitled NewBuy, the scheme is intended to help individuals in England to purchase homes and provides mortgage indemnity to enable them to do so.
In order to encourage lenders to provide home loans, the Government and building companies will act as guarantors for purchases where mortgages of up to 95 per cent of the value of a property is needed.
As well as increasing the national housing stock, NewBuy is also expected to boost construction jobs and activity by kick-starting the stalled property market and helping up to 100,000 buyers.
An estimated 50,000 additional employment opportunities could be generated by the move and demand is likely to rise for construction and civil engineering standards as building activity increases.
In addition, Prime Minister, David Cameron has revealed the right-to-buy discount is to be extended to social housing tenants to a maximum value of £75,000 in order to enable them to enter the property market, with any money raised from sales used to build affordable housing.
Discounts will start at 35 per cent for tenants with five years' residency, rising with the number of additional years people have accrued.
"Strong families and stable communities are built from good homes," he declared, adding: "That's why I want us to build more homes and I want more people to have the chance to own their own home."
NewBuy has received support from construction companies, banks, the Council of Mortgage Lenders and the Home Builders' Federation (HBF).
Commenting on the scheme, Stewart Baseley, HBF Executive Chairman, said: "The scheme will also provide a vital kick-start for house builders large and small who will be able to build the homes and create the jobs that the country desperately needs."