Benefits of New Build HomeBuy
The four main benefits of New Build HomeBuy are that it:
1. Costs less than a 100% mortgage
2. Helps you get started on the property ladder
3. Gives priority to people in housing need
4. And is a great investment in high quality housing
1. Costs less than a 100% mortgage:
The amount that you pay each month in your combined rent and mortgage repayment may well be less than if you had bought the property outright and were repaying a 100% mortgage.
You dont need a large deposit (a 5% deposit is needed if you are buying a 50% share).
You are exempt from paying stamp duty if the share you are buying is worth less than £125,000. (Please note though that if the share you are buying is worth more than £125,000 you will probably have to pay the full amount. Please speak to your solicitor in this instance.)
2. Helps you get started on the property ladder:
New Build HomeBuy lets you take that all-important first step on to the property ladder.
Mortgage lenders will normally lend a single person 3.5 times their income to buy a property. However, average house prices are now 8 times higher than the national average salary, making them too expensive for most first-time buyers to afford. New Build HomeBuy makes getting on the property ladder a more affordable option for first-time buyers and those unable to afford outright purchase, because you only need a mortgage for part of the property.
Proving that you can make regular mortgage repayments may make it easier for you to get a mortgage in the future.
In some cases you can build up the share of the property you own until you own it outright, so you are investing in your own home and not paying any rent. This is known as staircasing.
3. Gives priority to people in housing need:
When we are looking at applications for New Build HomeBuy, we take into account your housing need and income. We usually give priority to those considered to have the greatest housing need.
You can jointly apply as long as all applicants qualify.
It is a useful scheme for people who expect their income to increase in the future.
4. Is a great investment in high quality housing:
Most of the properties in the scheme are new or refurbished and come with buildings insurance and a NHBC or similar 10-year warranty.
It is an investment, allowing you to receive a share of any increase in the properties value should you choose to sell.