HomeBuy scheme flops on low numbers

| March 7, 2008 | 0 Comments

The Open Market HomeBuy scheme, launched by the Government in 2006, has helped only 451 people get a foot on the property ladder.

The £350 million project, which aims to help 150,000 key-workers and less well-off households by 2010, works in a similar way to a shared equity scheme.

It enables first-time buyers to purchase a minimum of 50% of the equity in a home with a low cost loan provided by English Partnerships, the regeneration agency.

Around half of the funding for the project has been set aside for key-workers, such as nurses, teachers and police officers.

The remainder is available to social housing tenants with a household income of less than £60,000 a year.

The disappointing figures have led to a review of the project, and from 1st April first-time buyers will be able to take out a mortgage for half the cost of their property at an initial interest rate of 1.75%.

They will need to combine this with a conventional mortgage from a bank or building society.

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