Breaking News

The new first-time buyer scheme where you can BUILD a home with just 5% deposit

THOUSANDS of wannabe homeowners could get help to build their own home with just a 5% deposit thanks to a new government scheme.

The Department for Levelling Up, Housing and Communities has announced its Help to Build Scheme.

The government has launched a new scheme to help families build their own homes

1

The government has launched a new scheme to help families build their own homesCredit: PA

It will allow people who don’t have large budgets to build self and custom-designed homes.

Applications for the scheme open on Monday, June 27.

With the scheme, the government can give you an equity loan based on the estimated costs to buy the plot of land and build your home.

The loan amount can be between 5% to 20%, and up to 40% in London.

Home on sale for £250k but everyone’s talking about the same bizarre thing
Garden pub with beer pumps and casino games in running to win Shed of the Year

A lot of people can’t afford to build their own homes, with the average deposit for the DIY option standing at around 25% of land and building costs.

It is hoped the scheme will help people do just this with its 5% deposit.

This includes people with disabilities or those with large families or elderly relatives who might need to build a bespoke home.

With a home costing £400,000 to build, you would need to raise £100,000 typically. At 5% this would be just £20,000.

It comes with first-time buyers struggling to get onto the property ladder, as house prices reach record highs.

Housing minister Stuart Andrew said the scheme would “break down barriers to homeownership” and create jobs.

However, Tim Bannister, director of property science at Rightmove, said finding appropriate land to build on and budgeting may be issues for prospective house builders applying to the scheme.

He said: “The challenge will be finding the land to buy and build on and getting the necessary planning permissions and mortgage.

“Those looking to take advantage of the scheme will still need to consider how much they are able to borrow from a lender, and whether it’s enough to build the home that they want or need.”

Meanwhile, Nick Mendes, a property expert at John Charcol, advised living near to the plot of land if you get to that stage.

He said: “You will want to ensure you live near to be able to manage the build, reduce your costs and have a contingency fund.

“Especially in the current climate of delays, increasing costs of materials.”

Those wanting to get onto the scheme can’t have total build costs be over £600,000, or £400,000 if the land is already owned.

For more information, you can visit the government’s website.

What other first-time buyer schemes are there?

If you don’t want to take up the government on its Help to Build Scheme offer, there are other options available to you.

The government has a help-to-buy equity loan scheme, and the application deadline is October 31.

The scheme sees the government lend homebuyers up to 20% of a homes value, or 40% in London.

But, you need a minimum deposit of 5% of the property purchase price.

You can find out more by visiting the government’s website.

If you are a housing association tenant, you can also buy your property under the Right to Acquire scheme.

You can apply to the scheme if you’ve had a public sector landlord for three years.

These landlords include housing associations, councils, the armed services and NHS trusts and foundation trusts.

Your property has to meet certain criteria as well.

It has to have been built or bought by a housing association after March 31, 1997, and funded through a social housing grant provided by the Housing Corporation or local council.

The property will have to have been transferred from a local council to a housing association after March 31, 1997, as well.

On top of this, your landlord must be registered with the Regulator of Social Housing.

The home you want to buy must also be self-contained and your only or main home.

For more details, you can see the government’s website.

Coronation Street fans stunned by age gap between Audrey and Gail actresses
I’m plus size and have found three outfits that won’t cling to your stomach

Other schemes, such as shared ownership, can also help people on to the property ladder.

Each week, we share stories of people who have managed to get onto the property ladder, through our My First Home series.

We pay for your stories!

Do you have a story for The Sun Online Money team?

About admin

Check Also

Modern Love Hyderabad Teaser Trailer: Telugu Adaptation of American Anthology Looks Promising

Modern Love Hyderabad first trailer is here. On Friday, streaming platform Amazon Prime Video released …

Leave a Reply

Your email address will not be published.