The new government has pledged to provide significantly discounted homes to "local" buyers
A pledge to give local first-time buyers a 30% discount on new homes was among several government plans outlined in the Queen’s Speech.
The Queen said: “My government will take steps to support home ownership, including by making homes available at a discount for local first-time buyers.”
In a briefing document published alongside the Queen’s speech the government said it would “shortly launch a consultation on First Homes.”
The aim of the consultation is to “provide homes for local people and key workers of at least 30%,” which could “save first-time buyers tens of thousands of pounds.”
The government claims that the changes will empower both home buyers and renters.
Housing secretary Robert Jenrick MP says: “The legislation that we will bring forward will provide a better deal for renters through our lifetime deposit scheme while also protecting them from no fault evictions.
“We will also help first-time buyers get a foot on the property market with 30% discounts for local people and key workers.”
The value of the properties will be held at a 30% discount "through a covenant." This means houses sold through the scheme will have a 30% discount in perpetuity, every time it is bought and resold.
However, experts warn that the government's plan could fall short. Henry Pryor, a property expert, says: "None of those Starter Homes have been delivered and this latest plan has some serious shortcomings.
"The plan is based on local councils using funds made available by house builders as part of the planning consent, something that would otherwise go towards so-called affordable homes or social housing for those unable to afford to rent or buy a home.
"We need to stop trying to solve the housing crisis by stimulating demand through schemes like this and Help to Buy and fix the supply side by making planning simpler."
The government has also been light on detail around the new proposals. The Ministry for Housing Communities and Local Government tells Moneywise that more details on the proposals "in due course."
What else has the government promised buyers and renters?
The government plans to renew the Affordable Homes Programme with an aim to build “hundreds of thousands of new homes for a range of people in different places.”
A new reformed Shared Ownership model will be introduced to make buying a share of a home “fairer and more transparent.”
In the coming months the government will release a Planning White Paper which will make the planning process “clearer, more accessible and more certain for all users.”
It has also pledged to launch a new £10bn Single Housing Infrastructure fund to provide roads, schools and GP surgeries needed to support new homes.
A comprehensive programme of reform to end unfair practise in the leasehold market will go forward. As part of this, the Government says that it will ensure that a new home will always be sold as a freehold and plans to scrap ground rents on new leases.
To help those who rent, the government says it will build a rental system that is “fit for the modern day.”
This will include working with landlords to “provide high quality homes while protecting renters.”
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