How the Conservative Government is encouraging home ownership

So, the Conservatives have won the majority vote in Parliament and David Cameron is set to return to Downing Street as Prime Minister once again. With the Conservatives taking somewhat of a surprising victory, how will homeowners, prospective buyers and landlords stand to benefit financially from the refreshed government?

Amidst all of the parties’ manifestos, first-time buyers found themselves at the helm of attention. Labour pledged to give them priority on new homes built for a period of two months and the Liberal Democrats proposed a ‘Rent to Own’ scheme where first-time buyers built up shares in their homes through renting. The party that matters though is the Conservatives.

Help to Buy ISA

Announced in the Budget in March, come the autumn, hopeful and prospective homeowners will receive a Help to Buy ISA “savings account” that will see the government top up £50 for every £200 saved towards a deposit, up to a maximum of £3,000.

Available for the next four years and being introduced in the autumn, the new savings account will only be available to consumers who are yet to buy their first home and there will be no limit to how long people can use the accounts.

First-time buyers based in London will be able to use the savings to buy properties worth up to £450,000, whilst the rest of the UK will see a ceiling of £250,000.

Discount homes for first-time buyers

David Cameron has pledged to offer up to 100,000 new homes to first-time buyers under the age of 40 at a discount of 20 per cent. The ‘starter homes’ initiative has been created to encourage home ownership amongst young buyers and to boost construction of new homes by building on brownfield land – land previously used for commercial uses or industrial purposes.

Whilst this means that, if you qualify, you will be able to afford a property that you would have previously struggled to buy, it should be noted that you won’t be able to sell the home at full market price for five years after you purchased it.

A London Land Commission will also help release brownfield land owned by the public sector in the Capital for building by promising a £1bn brownfield regeneration fund to unlock sites for around 400,000 homes.

What have they proposed?

One policy to mention, albeit controversial in the industry, is the expansion of the Right to Buy scheme which will see tenants of housing association properties receive sizeable discounts, allowing them to consider purchasing their homes. 1.3 million tenants could qualify for discounts of 35 per cent up to a maximum of 70 per cent, up to a maximum of £102,700 in London and £77,000 across the rest of the country.

With the general election now over, new policies from the Conservatives will be coming through thick and fast which is why it is important to speak to a professional mortgage adviser who will have the latest information to help you through the mortgage process.

This article was kindly contributed to Pace Properties by Paul Flavin, of Zing Mortgages. It is Paul’s belief that good financial advice should be available to everyone & that by simplifying the mortgage process you are able to make an informed choice through greater understanding.

Paul places great emphasis on customer service & always seeks feedback on how to best improve this area. “Making a house purchase or remortgage as painless an experience as possible for you is my objective”.