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Essex thumbs up for Help to Buy scheme
6:00am Thursday 10th October 2013 in News
A NEW Government scheme designed to get more people on the housing ladder has been met with approval across Essex.
The second phase of the help to buy scheme is launching next week, with the government offering buyers 95 per cent mortgages.
Unlike the first phase of help to buy, where the government lends new-build buyers 20 per cent of the property’s value, the second phase will stimulate the whole housing market, as it is aimed at people buying new-build and existing homes.
The initiative, which is set to run until January 2017, will see the state offer guarantees totalling around £12 billion to unlock £130 billion of mortgage lending.
But fears have been raised that the second phase of help to buy will send already rising house prices even higher by fuelling demand in the market at a time when the number of homes for sale is in relatively short supply.
Some analysts have said that the Government should be focusing its efforts on building more homes to meet demand rather than encouraging people to take on more debt.
Figures recently released by the Bank of England showed that the typical interest rate taken out by borrowers on new mortgages dropped in the second quarter to a new low of 3.47 per cent.
So far only NatWest, RBS and Halifax have announced that they will take part in the second phase of help to buy, but more lenders are expected to come forward in the coming months.
Shane Harris, manager of Haart Estate Agents in Leigh, said: “Even before this scheme there was a belief that the market was going in the right direction, and now there seems to be more life in the market.
“Personally, I love it. It’s going to help first time buyers and resales. It’s one of those schemes that’s been a long time coming. There’s been a lot of people asking about it and trying to work out what it’s all about.
“There’s a good feel about the market at the moment and there has been for a couple of months now. September was good and October has started really well too.
“I’m ever the optimist. I’m of the opinion that if something starts well it’s going to end well.”
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