400 make reservations on Newbuy and Govt advice on the Right to Buy

Figures released by the Home Builders Federation showed that 400 people have made reservations through the Newbuy scheme during its first nine weeks of operation.

The government-funded scheme allows buyers to access homes with deposits as low as 5 per cent.

There has been a slow start to the scheme with lenders not signing up as quickly as the government had hoped

Five lenders have signed up to Newbuy as well as 13 house builders. The scheme works by the builders and government contributing a total of 9 per cent of the value of each home sold to a fund, which then acts as an indemnity fund to guarantee buyers’ mortgage repayments.

The right to buy is to be promoted

The Communities and Local Government department has sent template letters to councils suggesting how they should promote the right to buy to tenants. The policy offers council tenants the right to buy their home with a discount of up to £75,000.The letter from the CLG suggested councils flag up how much a right to buy mortgage could cost per week. It said: ‘Buy your home for £100 a week? So, if like your neighbours, you’re interested in the right to buy, don’t delay.’

Only on an accompanying fact sheet it did warn tenants about the risks of losing their home if they cannot pay the mortgage.