The Budget confirms the Your First Home scheme, first reported by the Mirror, with £4.7bn of government-backed lending. The Chancellor, John Healey, told the Commons it was for buyers who "don't have the bank of mum and dad behind them", City AM reports.
First-time buyers can put down a deposit of between 2.5% and 15% and take a 20% equity loan on a new-build home in England. The loan is interest-free for the first five years and the rate then rises gradually, according to Mortgage Soup. The scheme opens next spring.
Household income is capped at £110,000 outside London and £140,000 in London. Property price caps follow median local prices, with limits of £650,000 in inner London and £500,000 in outer London. The government says the scheme will help around 70,000 households and support an estimated 20,000 new homes.
Zoopla estimates up to 30,000 buyers a year at about £1.5bn a year, so the £4.7bn would last around three years, Financial Reporter reports. Richard Donnell, executive director at Zoopla, said: "Localised price caps set at what first-time buyers want to pay for new homes means the Your First Home scheme will have around half the impact of the old Help to Buy scheme."
City AM reports that housebuilder shares rose on the announcement. That differs from an earlier report on this blog that the FTSE 250 fell because of housebuilders.