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Starter homes initiative set to boost house lending

16-Apr-2015

First time buyers are now able to buy a starter home via a new government website, it has been revealed.website, it has been revealed.

The starter-home.co.uk website represents yet another step in the government's push to make it easier for Brits to get onto the property ladder.website represents yet another step in the government's push to make it easier for Brits to get onto the property ladder.

Furthermore, the planning requirements for the new starter homes has been cut, which enables house builders to slash 20 per cent off the usual price.

With these houses, first time buyers have the potential to get discounts of up to £100,000 on each house. Building on the first properties is expected to start within months.

Currently, the average amount that a new buyer could expect to pay for a property is £218,000. However, a new starter home could save young first time buyers across the country an average of £43,000.

As part of a bid to encourage property construction, builders that develop commercial and industrial land that is either unusable or surplus, will be able to save on costs by freeing them from the requirement to provide affordable housing.

However in return, developers will have to offer the homes at a minimum 20 per cent discount on the market price to first time buyers who must be aged under 40.

Commenting on the developments, prime minister David Cameron announced: "A 20 per cent discount off the price could be a real game-changer for many aspiring home owners. My message is clear: we are on your side and we will help you fulfil your dream of buying your first home."

In addition, housing minister Brandon Lewis instructed local authorities across the country to look at land previously considered "unviable" for housing as potential sites for the homes.

He has also urged local authorities to prevent the resale and letting of the properties at open market value for at least five years.

Mr Lewis added: "In particular, they should look for opportunities to create high quality, well designed starter homes through exception sites on commercial and industrial land that is either underused or unviable in its current or former use, and which has not currently been identified for housing.

"Where applications for starter homes come forward on such exception sites, they should be approved unless the local planning authority can demonstrate that there are overriding conflicts with the National Planning Policy Framework that cannot be mitigated."

The initiative is the latest in a long line of positive housing market developments to emerge across the UK.

Data published by the Council of Mortgage Lenders showed that house purchase lending in Wales increased by nine per cent last year with a consistent performance throughout 2014.

The findings showed that first time buyers in Wales borrowed £330 million in the fourth quarter. Although this was unchanged compared to the third quarter in value, it represents a rise of three per cent in number of loans.

In 2014 as a whole, Wales accounted for 2.8 per cent of the UK wide house purchase activity.
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