Chancellor George Osborne says he was advised by the industry against increasing the Government’s new first-time buyer scheme beyond 10,000 homes.
In last week’s Budget, Osborne unveiled plans to support FTBs moving into new build properties with the Government and house builders stumping up a 20 per cent deposit in the form of low-interest loans.
Mortgage brokers have criticised the scheme for being too small but Osborne told MPs at a Treasury select committee meeting today that the size of the scheme was decided based on industry advice.
He said: “The reason we identified 10,000 as a reasonable number was because that was the number the industry told us, the capacity they were able to do. I could have provided more money if I had been able to and make other choices in the budget, but the industry themselves were clear about their capacity constraints.”
Osborne said the scheme is not a “silver bullet” to helping FTBs onto the housing ladder but he was attracted by the fact it could be implemented quickly.
He said: “The idea of shared equity schemes for first-time buyers in new build properties was something that we could get out of the door from the beginning of the new financial year without having to spend months or years designing some new scheme.”