First time home buyer news: Affordable homes crisis

25-May-2006

There are fewer affordable homes being built to suit first-time home buyers, with 70 per cent of all new homes being priced at £150,000 or more, according to latest research.

A survey by warranty provider, Premier Guarantee, reveals that there have been 11 per cent fewer applications by housing associations to build affordable housing for first-time home buyers.

The company claims that there should be more help from the government to assist those who cannot afford to buy homes at current market prices.

"The government must do more to assist first-time buyers with the expansion of the shared equity scheme, along with the release of government-owned land for the creation of more low-cost homes which are truly affordable," says Robin Plaster, sales and marketing director for Premier Guarantee.

Shared equity schemes are based on the fact that first-time buyers will be able to raise a certain proportion of the property's cost, with the remainder being shared between the government and lenders.

However, the firm states that if the amount of available housing does not increase then shared equity schemes may cause house prices to rise.

The Department for Communities and Local Government claims that more than one million households have incomes that are too high for benefits and too low for buying a home.

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