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First-time buyers in the dark

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Recent research cited by Property Reporter recently suggests that around a half of all first-time buyers are either confused or completely ignorant about the various schemes that are available to help them get that first step on the housing ladder.

Among those who were aware of the existence of such schemes, the majority – 58% – believed that they were too complicated to understand. That view was shared by a staggering 64% of those in the 18 to 34-year-old age group. Only 8% of those surveyed believed that schemes to help first-time buyers are easy to understand.

About a half of those questioned knew that such schemes existed, yet the same proportion were unable to identify them. Despite the availability of Help to Buy Equity Loans, Help to Buy ISAs, and various shared ownership programmes, only 20% of those questioned in the nationwide survey were able to name even one of the schemes.

Property Reporter briefly outlined the main features of the main schemes:

Help to Buy Equity Loans

  • with a deposit of just 5%, qualifying homebuyers can get an interest-free government loan of up to 20% for the purchase of a property;
  • in other words, they might then only need a mortgage to cover 75% of its purchase price;

Help to Buy ISAs

  • these offer a free top-up of the holder’s savings when used as the deposit on the purchase of a first home;
  • the scheme closes to new applicants at the end of this month (November 2019);

Shared ownership

  • various shared ownership schemes are run by housing associations for first-time buyers with combined earnings of less than £80,000 a year (£90,000 in London).