FTB get up to 50 percent off the cost of special new build home

[413x]

This seems like a win win scenario for anyone getting one. And a big kick to anyone who can't get one. As appears to be only going forward on pre selected homes.

I can't quite discern the details but here it is

https://www.google.com/amp/s/amp.th...-in-england-offered-new-homes-at-up-to-50-off

Potentially 50 percent off a home with no rent etc to pay on the other half.

Landing one of these means if you never move you have a tiny mortgage, could buy up other property to rent out etc etc. It's a massive massive win for anyone who gets one.

Imagine paying 400 rather than 800 ppm and having a 800ppm home! Feels like anyone who gets one is onto an absolute massive winner.

How will they decide who gets these homes? Because it could be life changing for those who do/don't!


Personally I don't agree with it. As it has to be means tested or a lottery. It makes it really hard for FTB. Do you hold out to get one. And put off purchasing a new home at full price if you can afford it?
How will they prioritise?it will further boost house prices making it harder for anyone who can't get one.


Edit
Looks like you can only sell to new FTBs

 

[Josh]

Reads like a re-do of the right to buy policy for council tenants to me.

 

[413x]

I'm not a fan of any scheme like this that isn't a level playing field. At least help-to-buy was available to all.

This will benefit a small number of FTB significantly

 

[Armageus]

The scheme is for first-time buyers only; households with a combined annual income of more than £80,000 – or £90,000 in Greater London – cannot apply

Surely that's still on the high side? If you can't save a deposit / afford a mortgage at £80k/year you are doing something wrong.

To genuinely help people struggling to buy this should be capped nearer £50k

 

[Tom_ed1987]

I don't think this is a good use of government funds at all. Are the details available anywhere?

 

[Richie]

Landing one of these means if you never move you have a tiny mortgage, could buy up other property to rent out etc etc. It's a massive massive win for anyone who gets one.

Really?

The housing market is in the current situation of high prices partly due to BTL making it extremely difficult for FTB to get on the property ladder. This scheme is being introduced to assist FTB and you suggest using this scheme to allow more BTL?

Please tell me I'm not the only one that sees the craziness/hypocrisy in this

 

[2004typer]

Really?

The housing market is in the current situation of high prices partly due to BTL making it extremely difficult for FTB to get on the property ladder. This scheme is being introduced to assist FTB and you suggest using this scheme to allow more BTL?

Please tell me I'm not the only one that sees the craziness/hypocrisy in this

I think the OP means the above in a negative way, but for any persons who are able to land one of these houses, they will have more spare funds so might have the resources to buy additional property that they can then rent out - so a further kick in the teeth for those left out (i.e. they end up renting a second property from one of the beneficiary's of the above scheme, so not only are the beneficiary's getting a cut price brand new house, but also some other poor mug paying off their mortgage on a second property).

Hopefully there'll be conditions that you can't own any other property and if you ever do the subsidy ends (but how they'd control this where there is a couple and only one person is the applicant I wouldn't know).

And I agree above the 80k limit seems rather high, pretty easy to buy a house on this income - don't need to go and get a 5 bed detached house with a double garage for your first place, do what most people do and build up steadily, but on this scheme it seems that you can likely get a house a few rungs up the ladder in the first place (if I'm right understanding that at typical rate of 4.5x joint income, so 80k = 360k, so a potential total property value of 720k if max. 50% discount). Assume though that houses of this stature price wise might not be the aim of the scheme, so it might be mostly smaller places aimed size wise at the typical FTB.

 

[413x]

I think the OP means the above in a negative way, but for any persons who are able to land one of these houses, they will have more spare funds so might have the resources to buy additional property that they can then rent out - so a further kick in the teeth for those left out (i.e. they end up renting a second property from one of the beneficiary's of the above scheme, so not only are the beneficiary's getting a cut price brand new house, but also some other poor mug paying off their mortgage on a second property).

Hopefully there'll be conditions that you can't own any other property and if you ever do the subsidy ends (but how they'd control this where there is a couple and only one person is the applicant I wouldn't know).

And I agree above the 80k limit seems rather high, pretty easy to buy a house on this income - don't need to go and get a 5 bed detached house with a double garage for your first place, do what most people do and build up steadily, but on this scheme it seems that you can likely get a house a few rungs up the ladder in the first place (if I'm right understanding that at typical rate of 4.5x joint income, so 80k = 360k, so a potential total property value of 720k if max. 50% discount). Assume though that houses of this stature price wise might not be the aim of the scheme, so it might be mostly smaller places aimed size wise at the typical FTB.

Yeah this.
80k is very high.
Anyone who is at the upper end of this could end up with a cheap house, low mortgage, ability to save and develop a portfolio due to government help. Or tax payer help.

It absolutely should not extend to 80k.

 

[Resident]

Really?

The housing market is in the current situation of high prices partly due to BTL making it extremely difficult for FTB to get on the property ladder. This scheme is being introduced to assist FTB and you suggest using this scheme to allow more BTL?

Please tell me I'm not the only one that sees the craziness/hypocrisy in this

BTL needs banning & existing LLs licenced with one and only penalty for not following the rules, foreiture of any and all property (excluding their own home) to social housing stock.

Right to Buy also needs to go. Social housing stock should never be anything other. Here in Sheffield the housing waiting list is over 40,000 applications, with 1/3 stated as being in desparate need. But told Beryl, who lives on her own and has had a 4 bed council house since 1962, had no kids at home since the early 80s is allowed to buy her council house cheap, meanwhile a family of 5, in need of that 4 bed are still cramped into 2 bed temporary accomodation.

 

[2004typer]

Right to Buy also needs to go. Social housing stock should never be anything other. Here in Sheffield the housing waiting list is over 40,000 applications, with 1/3 stated as being in desparate need. But told Beryl, who lives on her own and has had a 4 bed council house since 1962, had no kids at home since the early 80s is allowed to buy her council house cheap, meanwhile a family of 5, in need of that 4 bed are still cramped into 2 bed temporary accomodation.

Agree with this as well, social housing is an asset that needs to be matched to the people in need, rather than being sold off at a vastly reduced rate.

Obviously there is the situation where an under occupied house is still in social housing control and the tenant remains, and I wouldn't be keen on forcing people out of a home they've lived in for ages and have good local roots/friends/family/community, but perhaps there could be a scheme to coerce people to forfeit a property they don't need anymore, perhaps a priority list and discounted rental for a period, and a choice of a home in a location they are happy with (of a suitable size for the number of occupants).

 

[Dis86]

Surely that's still on the high side? If you can't save a deposit / afford a mortgage at £80k/year you are doing something wrong.

To genuinely help people struggling to buy this should be capped nearer £50k

Completely agree. Thats up to 3 times the median household income!

 

[B@Th*nG]

I'm not a fan of any scheme like this that isn't a level playing field. At least help-to-buy was available to all.

This will benefit a small number of FTB significantly

Let's be fair, it isn't a level playing field now is it. The price of houses is ridiculous

 

[dowie]

It's not clear how the discount/up to 50% chunk they don't really own works beyond the initial purchase and the fact it exists?

I mean essentially this is like shared ownership but without the need to pay rent on the equity you don't own right?

With a shared ownership property you can buy a greater share of the property over time - not clear if that is available here (presumably not if they want it to be passed on to other FTBers upon sale)?

Also, re: selling how does that work? Presumably, you can't leave it unconstrained otherwise the discount becomes moot - why wouldn't someone be prepared to pay (second hand) say 300K or 350k rather than 200k for their theoretical 50% share of an otherwise 400k property? Needs some mechanism to value it and set a price right?

Surely that's still on the high side? If you can't save a deposit / afford a mortgage at £80k/year you are doing something wrong.

To genuinely help people struggling to buy this should be capped nearer £50k

That could just serve to limit the homes developers could offer, depending on the area at least. 80k is the current ceiling for participation in shared ownership schemes already (outside London) so it sort of makes sense to have this scheme in line with the existing criteria.

If you're earning 80k per year in household income you're perhaps looking at a different budget/price range to others on say 40k or 50k. It probably is on the high side in some parts of the country though to be fair but maybe not in London or the South East. They're probably not competing with each other for the most part, a developer can offer a variety of homes.

They'll still need detailed planning permission so I presume they can't just propose some scheme full of homes only suitable for people earning circa 80k in household income, unless they're perhaps building in Westminster or Kensington and Chelsea or something.

 

[413x]

Let's be fair, it isn't a level playing field now is it. The price of houses is ridiculous

No its not. The endless tampering to keep house prices growing is going to bite at some point.



The previous shared ownership was a bit fairer really. You were still incentivised to buy out the whole house.
With this one you aren't.
If you got this 500k house for 250 under this scheme it's quite possible you'd never need to move. A 500k house is a lot more than most will ever get (taking prices today).
If you moved you'd be downgrading. To upgrade You'd need to move to a 600k house (let's say) but stump up 350k of non existent equity.

This is set up to give people potentially a forever home at half price. It's crazy.

 

[Resident]

Agree with this as well, social housing is an asset that needs to be matched to the people in need, rather than being sold off at a vastly reduced rate.

Obviously there is the situation where an under occupied house is still in social housing control and the tenant remains, and I wouldn't be keen on forcing people out of a home they've lived in for ages and have good local roots/friends/family/community, but perhaps there could be a scheme to coerce people to forfeit a property they don't need anymore, perhaps a priority list and discounted rental for a period, and a choice of a home in a location they are happy with (of a suitable size for the number of occupants).

My mum was in a 3 bed social house. We (her kids) moved out and since my dad died she was on her own in the house. She applied for a 1 bed property & given her life was in the village the council kept her in the 3 bed until something came available (didn't take long). She applied because, in her words, it wasn't right that she take up a family house.

I believe in recent years there has been a clause in the contract with social housing that tenants are obliged to request downsize when they no longer require the space, though I could be wrong.

One way I would ensure this happens is link housing benefit to need. If you're on your own in a 3-bed then your HB would only cover upto the cost of a 1-bed dwelling.

 

[Dolph]

Yet more pointless tinkering around the edges that ignores the two key drivers of UK house prices, location desirability, and the planning system significantly limiting developable land and sending prices of it ever higher.

 

[OpenToSuggestions]

More people can afford ->Prices go up.

The fundamental problem is still the same:
1) Not enough houses.
2) People not willing to sacrifice their lifestyles to save up towards a house.

 

[EdGey]

"demonstrate a need for it" - What does that mean? If you can afford to drop 100-200k on a house then you clearly do not "need" another 50% of value on top of it, you just need to save longer like everyone else.

 

[dowie]

One way I would ensure this happens is link housing benefit to need. If you're on your own in a 3-bed then your HB would only cover upto the cost of a 1-bed dwelling.

Something like this already exists, nicknamed the "bedroom tax", people moaned about it being unfair, blah blah evil Tories etc..

https://en.wikipedia.org/wiki/Bedroom_tax

The under-occupancy penalty (also known as the under occupation penalty, under-occupancy charge, under-occupation charge or size criteria)[1] results from a reform contained in the British Welfare Reform Act 2012 whereby tenants living in public housing (also called council or social housing) with rooms deemed "spare" face a reduction in Housing Benefit, resulting in them being obliged to fund this reduction from their incomes or to face rent arrears and potential eviction by their landlord (be that the local authority or a housing association).

 

[Dolph]

Something like this already exists, nicknamed the "bedroom tax", people moaned about it being unfair, blah blah evil Tories etc..

https://en.wikipedia.org/wiki/Bedroom_tax

And somewhat ironically, it was introduced initially on private rentals by labour as part of the introduction of local housing allowance.

https://en.m.wikipedia.org/wiki/Local_Housing_Allowance

All the Tories did, that they got attacked for, was applied the same rules to housing benefit (that goes to people renting from local authorities or social housing providers).

Still, it's definitely the Tories fault, because apparently it always is.