95% mortgage deals backed by the state: First-time buyers can get on the property ladder with just a 5% deposit under a new scheme launching today
- High street banks including Lloyds, Santander and Barclays will start offering state-backed mortgages under a government scheme launching today
- Both first-time buyers and current homeowners will be able to access the mortgages to buy homes up to £600,000
- The move comes as the average price of a UK property coming to market has hit an all-time high of £327,797
First-time buyers will be able to get on the property ladder with just a five per cent deposit under a government scheme launching today.
High street banks including Lloyds, Santander and Barclays will start offering state-backed mortgages worth up to 95 per cent of the value of a home. Other lenders taking part are HSBC and NatWest.
The scheme, announced by Chancellor Rishi Sunak in the Budget, is designed to encourage banks to offer low-deposit mortgages by ensuring a government guarantee in case of losses.
Both first-time buyers and current homeowners will be able to access the mortgages to buy houses worth up to £600,000.
It comes as the average price of a UK property coming to market has hit an all-time high of £327,797, according to research from property website Rightmove.
First-time buyers will be able to get on the property ladder with just a five per cent deposit under a government scheme launching today [Stock image]
The house-buying boom during the pandemic, driven by stamp duty cuts and a desire for more space, has pushed the stock of homes available to buy to the lowest proportion ever recorded.
Prices have surged 2.1 per cent or £6,733 in the past month alone, and two and three-bedroom semi-detached houses are being snapped up quickest – 30 per cent of those marked as sold between March and April by estate agents had been on the market for less than a week.
Tim Bannister, of Rightmove, said: ‘This is only the second time over the past five years that prices have increased by over 2 per cent in a month, so it’s a big jump, especially bearing in mind that the lockdown restrictions are still limiting the population’s movements and activities.
‘There’s also growing optimism due to the vaccination rollout, which is helping drive the momentum for a fresh start in fresh surroundings.’
First-time buyers are now paying an average of £203,564 across the UK, excluding inner London.
So-called second-stepper properties, which include all three and four-bed properties except four-bed detached homes, were coming to market at £299,956 in April. And houses at the top of the market, including five-bed and four-bed detached properties, were put on sale for an average of £590,293.
High street banks including Lloyds, Santander and Barclays will start offering state-backed mortgages worth up to 95 per cent of the value of a home. Other lenders taking part are HSBC and NatWest [Stock image]
Housing Secretary Robert Jenrick said ministers want to turn ‘generation rent’ into ‘generation buy’.
He added: ‘For too many people, no matter how hard they work, home-ownership can seem out of reach.
‘One of the biggest divides in our country has been between those who can afford their own home and those who cannot.
‘That’s why we are determined to do everything we can to help hard-working families and first-time buyers get their feet on the housing ladder in an easy and affordable way, to level up this country.’
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