Prime Minister David Cameron unveils a 20 per cent discount for first-time buyers – but will the move still freeze most people out of the housing market?
First-time house-buyers under the age of 40 have been promised a 20 per cent discount on their homes as the government pushes plans to build tens of thousands of starter homes on cheaper brownfield sites.
Homes built under the proposed Help to Buy Starter Homes scheme would be exempt from a range of taxes, enabling them to be sold at a discount on the normal market rate.
Prime Minister David Cameron said he wanted “young people who work hard, who do the right thing, to be able to buy their own home”.
“They can’t be bought by foreigners, they can’t be bought by buy-to-let landlords and they can’t be flipped around in a quick sale,” he added.
Young people across the country are priced out of home ownership Shadow housing minister Emma Reynolds
“They can only be bought by hard-working people under the age of 40.”
The cut-price homes will be built on brownfield land which has already been set aside for development but is no longer needed for industrial or commercial use.
Such land is not normally made available for housebuilding and can be bought more cheaply than other land, with the savings being passed on to the buyer.
Public sector land which is surplus to requirements will also be brought into the scheme.
The properties would be exempt from most of the taxes imposed on new homes, such as the social housing requirement and the community infrastructure levy.
Some future regulations such as the zero carbon homes standard will also not apply to properties built under the scheme.
But doubts have been raised as to how effective the plan would be, with large numbers of young people still potentially frozen out of the housing market by high prices.
Shadow housing minister Emma Reynolds said “fundamental changes” were needed to the way the housing market works, adding that Mr Cameron had presided over the lowest level of house-building in peacetime since the 1920s.
She said: “After four and a half years he now tells us that he is going to deliver for first-time buyers but under his Government a record one in four young people are living at home with their parents and young people across the country are priced out of home ownership.”