Mortgage brokers are disappointed by the Government’s decision not to put any additional funding into its Open Market HomeBuy scheme.
The Government also revealed last week that its new 17.5 per cent equity loan product will only be open to the same categories of borrower as the existing scheme despite acknowledging in its housing green paper that it is not flexible enough.
A spokesman for the Department for Communities and Local Government says the product will be funded from the existing £500m low-cost ownership budget and remains limited to key public-sector workers, social tenants and other priority first-time buyers.
Savills Private Finance managing director Mark Harris says: “We welcome any move to help first-time buyers on to the housing ladder but reports that it is just the same pot of money available distributed through slightly different means is a missed opportunity.
“It is all very well tweaking and adjusting the way in which funding is distributed to those struggling to get on the housing ladder but what is really needed is an increased commitment from the Government in terms of hard cash and more progress on the joint public-private funding initiatives.”
Hamptons technical director Jonathan Cornell says the Government is merely window-dressing the scheme and is particularly disappointed that it is failing to put any new investment into HomeBuy.
He says: “The evidence goes against what the Government is claiming to do in helping first-time buyers.”
John Charcol senior technical manager Ray Boulger says: “This is pretty typical of the Government’s stance on housing. It makes an announcement that appears positive, which it is for some, but then it turns out to be a loss for others.”
The Government says the scheme will help 25,000 people a year get on to the housing ladder – an increase of 5,000 from its previous target.
Mortgage analysis, p30 For more mortgage news, visit www.moneymarketing.co.uk/mortgages