A leading Midlands law firm has welcomed the government’s new “Your First Home” scheme, designed to help first time buyers get onto the property ladder.
Prime Minister Andy Burnham announced the plan this weekend as he arrived at Labour’s annual conference in Liverpool. It will allow first time buyers in England to purchase a new build home with a deposit of just 2.5%.
Buyers will also receive a government-backed equity loan worth 20% of the property’s value, which will initially be interest-free. Based on the average first home price of £230,000, that would mean a deposit of £5,750 and a loan of up to £46,000.
The initiative is aimed at buyers who cannot call on the “bank of mum and dad”. Full details are due to be confirmed in the Budget on 28 October.
Samantha Ingram, Equity Director at Davisons Law, said: “It’s really positive to see this support for first time buyers being announced. With more and more financial challenges facing those wanting to take their first step on the property ladder, it will certainly be a welcome initiative.”
She added: “Saving a deposit is one of the biggest hurdles for first time buyers, so reducing what they need to find upfront could make a real difference to people who have felt locked out of the market.”
It follows similar past initiatives, which allowed first time buyers to purchase a new build home with a small deposit and the help of a government-backed equity loan.
Davisons Law has a long history of guiding first time buyers through the legal process of schemes like this.
Mrs Ingram said: “Buying with an equity loan is different to a standard purchase, and buyers need to understand exactly what they are signing up to. Choosing the right solicitor is key to a stress-free journey. Anyone thinking of using this should also keep an eye on the Budget, when the finer detail is confirmed.”
