It has also allocated £200m to buy new properties on the open market for first-time buyers to purchase through its HomeBuy scheme or for social renting.
All first-time buyers with a household income of £60,000 a year or less are now eligible to apply for the HomeBuy programme which allows them to purchase a share of a property, from 25 per cent, or to boost their purchasing power by up to 50 per cent with a shared equity mortgage.
Housing minister Caroline Flint says: “Most families aspire to get on to the housing ladder but are being priced out of the market. We want to help them buy an affordable home.”
LibDem housing spokesman Lembit Opik says: “Finally, the Government has realised their first-time buyer schemes have helped too few families into homeownership. But where is the support for those facing repossession and homelessness? The Government must consider how struggling homeowners could be helped into shared ownership schemes to prevent repossession.”
SmartNewHomes.com managing director David Bexon says: “This is a drop in the ocean for cash-strapped first-time buyers looking for the opportunity to buy through a shared ownership scheme. A much bigger solution is required, such as scrapping stamp duty for these buyers. This would show that the Government is really committed to kickstarting the housing market.”
Mortgageforce chief executive Rob Clifford says: “Extending the shared equity and shared ownership schemes is welcome but there is a supply problem which will always cause bottlenecks. The £200m will only buy a few properties and I think we need a pragmatic solution to ease supply.”