The home building industry has today welcomed the launch of NewBuy, a scheme that will provide a helping hand to home-buyers currently shut out of the housing market and boost housing construction across the country, creating thousands of jobs and driving up economic growth.
Already 130 small and large builders have registered their interest in participating in the scheme with Home Builders Federation. The companies represent a wide spectrum of the housing construction industry and, in turn, have had over 28,000 expressions of interest from prospective home buyers.
The scheme will mean that as many as 100,000 buyers currently unable to purchase a home will be able to use a 95% mortgage to get a foot on, or take their next step up, the property ladder.
This will provide a much needed boost to housing construction and will see 50,000 jobs created and safe-guarded on sites all around England with more established in the supply chain.
NewBuy has been designed by the Home Builders Federation and the Council of Mortgage Lenders; support from the government in the form of the guarantee has made it a reality.
The house building industry has wholeheartedly welcomed the scheme.
Currently 7 builders already have agreements with lenders in place:
Crest Nicholson & Miller Homes will have agreements in place imminently.
Stewart Baseley, Executive Chairman of the HBF said:
"NewBuy will help thousands of people to meet their aspirations to buy a new home, freeing up the housing market and helping first time buyers and those unable to take the next step on the ladder.
"The scheme will also provide a vital kick-start for house builders large and small who will be able to build the homes and create the jobs that the country desperately needs.
"The launch of NewBuy is a credit to developers, lenders, JLT and government who have all shown real determination and imagination to address the key issue that has kept the housing market and house building subdued for the last few years."
NewBuy has been welcomed across the home building industry:
Stephen H. Brazier, Managing Director, Aquinna Homes
"The creation of NewBuy reveals how important the housing market and housing construction is both socially and economically. It's vital that the scheme does what it says on the tin, helping buyers get up the property ladder and large and small developers build homes and create jobs in communities across the country."
Mark Clare, Chief Executive, Barratt Developments
"This is potentially a real boost for home buyers who have been locked out of the housing market by the high level of deposits required to buy a home."
'Nearly 20,000 potential homebuyers from all around England have pre-registered their interest on the company's website with the weekly registration rate now hitting 1,500.'
"The key thing is that people will no longer need deposits of up to 20 per cent which gives creditworthy buyers the best opportunity for five years to get on the housing ladder.
'This is also a great way to get the economy moving whilst tackling the housing shortage. We know that building homes creates local jobs so it's good news for everyone in the industry.'
Maria Seed, Group Sales Director, Bellway
"The launch of NewBuy is a very welcome initiative that will increase the size of the housing market and enable many more people to own a home of their own. By reducing the size of the deposit to 5% to qualify for a mortgage and ensuring competitive interest rates means that owning a new home is far more affordable."
David Ritchie, Chief Executive, Bovis Homes
"We have now delivered a powerful new purchase assistance scheme into the marketplace and it is one that we hope will allow significant numbers of new Bovis Homes customers to realise their aspirations of getting on or moving up the property ladder.
"Higher deposits have undoubtedly been a significant factor in slowing down the market but this new 5% deposit requirement promises to give the market a major boost - especially as it is available to existing homeowners and first-time buyers alike.
"At Bovis Homes we have been proactive in helping to develop low-deposit homebuying solutions with lenders and we were delighted to be able to feed into the process as NewBuy was developed. We believe we now have a strong portfolio of purchase assistance schemes which will allow a wide variety of different buyers to make their move."
John Cawrey, Director, Cawrey Homes
"Anything that can give confidence to buyers and lenders in the current housing market will help house builders to deliver the new homes that are needed throughout the UK."
Stephen Stone, Chief Executive, Crest Nicholson,:
"These measures are exactly what are needed to inject some movement into the housing market and fuel recovery. Constraints on the mortgage market have been one of the most prohibiting factors to people wanting to get on or move up the housing ladder in recent times, but this is a bold move from both government and industry that will offer purchasers some much needed financial support to help bridge the deposit gap."
Andy Yallop, Chief Executive, Croudace Homes Ltd.
"Lack of mortgages on affordable terms, particularly with regard to the level of deposits required, has been a major constraint to the housing market. First time buyers have been particularly hard hit.
"This has had an adverse effect both upon our business and the many who wish to buy one of our new homes.
"NewBuy is an exciting opportunity for us to work together with Government and lenders to unlock the situation, thereby enabling us to provide more new homes to the benefit of both those who wish to buy and those whose jobs it is to build them."
Darren Smith, MD, Darren Smith Homes
"NewBuy is the shot in the arm the industry needs, the lack of mortgages has prevented buyers from buying and builders from building so this should help companies large and small get on and do what they do best"
Jason Glover, Operations Director, Davidsons
"As a smaller independent house builder, NewBuy is going to help us build more homes and create jobs in our local area as families unable to buy a new home are able to realise their aspirations."
Paul Halliwell, Northern Regional Director, Elan Homes
"We welcome NewBuy which is a positive step for home buyers and home builders - Elan Homes is looking forward to working with lenders to help people realise their aspirations of a brand new home and create more jobs on building sites across our region"
Ian Sutcliffe, Group Chief Executive, Keepmoat
"Credit must go to the Home Builders Federation for the work that has gone into bringing all the parties together to create NewBuy.
"Access to affordable borrowing remains the greatest issue for home buyers. The NewBuy scheme is a significant and very welcome initiative in assisting new house sales right across the country. "
David Thomas, Sales and Marketing Director, Kier Homes
"Kier Homes is delighted to be part of the NewBuy scheme. Access to mortgage finance has been a significant hurdle in re-invigorating the housing market and we believe that the NewBuy initiative will go a long way to restoring lenders' confidence and hence to releasing much needed mortgage funds. We expect NewBuy to be very popular amongst our customers, allowing them to move in to a new home with only a 5% deposit. Deposits of around 5% remain achievable savings targets for many people looking to buy their first home, having to find up to 25% for a deposit in order to access mortgage finance has suspended the dreams of many house hunters."
Ian Baker, Divisional Managing Director, Linden Homes Group
"It is encouraging to see the government supporting a bold move from the Home Builders Federation and lenders in boosting mortgage availability and showing real confidence in the market once again. New home construction provides a significant contribution to the UK's general economic growth and the availability of mortgages is a major contributing factor in this.
"We believe NewBuy will further extend a helping hand to people struggling to get onto or step up the property ladder, and its visibility will help to provide buyers with the confidence they had pre-recession that responsible lending is attainable."
Chris Endsor, Chief Executive, Miller Homes
"Miller is looking forward to joining the scheme imminently and all credit needs to go to the work Home Builders Federation have done to drive the innovative and complex project forward to fruition in an incredibly tight timescale.
To launch NewBuy for the early spring market is a massive step forward for the new homes market and wider economy and is exactly what is needed to meet the pent up demand from purchasers who have previously been restricted from buying."
Mike Farley, Group Chief Executive, Persimmon
"Today's launch of NewBuy by the Home Builders Federation, lenders and Government is hugely significant as it removes the obstacle of a large deposit which has been a key factor holding back the housing market in recent years. NewBuy opens up a 95 per cent mortgage product to both first time buyers and those looking to move up the property ladder. Importantly, it has no salary cap and is available to purchasers of new homes up to the value of £500,000.
"Initial rates from the large high street lenders to support this product look very favourable, making NewBuy an attractive mortgage option for buyers of new build homes. NewBuy is a much-needed shot in the arm for the whole housing sector and - with research showing every new home built creates five jobs - the Government's provision of up to 100,000 NewBuy mortgages will also give a welcome boost to UK growth and employment."
Steve Morgan, Chairman, Redrow
"From the number of enquiries we have received, we know there is huge pent-up demand for new homes.
"The NewBuy scheme will help unlock that demand by removing some of the biggest obstacles that buyers have faced.
"The scheme will provide an important confidence boost to the housing market and we are delighted to be among the first to make it available."
Ken Whitaker, Managing Director, Seddon Homes Limited
""We are looking forward to NewBuy enabling to our customers to access new homes for their families from which they have been excluded by difficult lending criteria in recent years.
"The flexible nature of the scheme and the way it can be accessed across a range of sites, types of homes and sizes of builder will maximise its impact and generate new activity right across the country.
"As a regional house builder this will enable us to build and sell more houses on our patch, generating work and economic activity which will have a direct impact on local jobs and prosperity."
Mark Connors, Managing Director, Shepherd Homes Ltd.
"NewBuy can offer the opportunity for families to meet their aspirations and own a new home; at the same time it will enable our company to create local jobs and give a lift to the area's economy."
Pete Redfern, Chief Executive, Taylor Wimpey
"We welcome the NewBuy scheme as we believe it will go a long way in helping a wide range of buyers who have had to put their dreams of getting on or moving up the property ladder on hold due to the size of deposits required by mortgage lenders.
"Availability of affordable mortgages is so often cited by our customers as their main barrier to purchase. Increasing the number of 95% mortgages being offered by lenders should have a significant positive impact on the market."
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