Two week countdown for Help to Buy London launch
It’s just a fortnight until the launch of Help to Buy London, a Government initiative designed to make it easier for those who can’t afford to purchase a property in the capital to get onto the housing ladder, with a little help from the state.
Help to Buy London was announced in Geroge Osborne’s recent Autumn Statement, as part of a host of measures aimed at boosting homeownership.
The Help to Buy Equity Loan scheme is already well estatblished across the country, but Osborne announced a new twist with Help to Buy London that effectively doubles the Government help you can access in the form of an equity loan.
This is necessary because the high prices in the capital make homeownership unachieveable for many, even with the existing Help to Buy scheme.
Help to Buy London is only available on newly built homes (another scheme Help to Buy: Mortgage Guarantee covers existing properties).
How does it work?
With a Help to Buy London: equity loan the Government lends you up to 40% of the cost of your new-build home, so you’ll only need a 5% cash deposit and a 55% mortgage to make up the rest.
You are the full owner of the property, and you won’t be charged loan fees on the 40% loan for the first five years of owning your home. After five years you will be charged 1.75% interest on your loan which will move in line with inflation.
Who is eligible?
Equity loans are available to first-time buyers and existing homeowners looking to move. The home you buy must be newly built with a price of up to £600,000.
You must not own any other property at the time you buy your new home with a Help to Buy equity loan, and you are not allowed to sub-let the property.
Help to Buy London launches on 1st February. You can find your nearest Help to Buy agent by visiting the Government’s dedicated Help to Buy website.