Young first-time home buyers in line for starter discount

Under 40s are being encouraged to buy starter homes at cut-down prices under new government plans to exploit underused brownfield sites.

About 45 home developers have expressed interest in taking advantage of new home-building rules that come in from Monday, that encourage builders to use brownfield sites for building cheaper houses which in turn would be offered to younger buyers at a discount.

Developers would be relieved of about £15,000 in home obligations under the new rules.

With the cost of the average first home reaching £218,000, buyers could save tens of thousands of pounds – and under-40s could snap up a cut-price home by expressing interest online.

The discount will apply for five years to prevent anyone seeking to make a quick profit.

‘Game changer’

Prime Minister David Cameron said his government wants “to help people who work hard and want to get on in life but have been priced out of the housing market”.

“A 20 per cent discount off the price could be a real game-changer for many aspiring home-owners,” he added.

The scheme was first announced by Mr Cameron in September 2014, and he was adamant the homes could “only be bought by hard-working people under the age of 40”.

“They can’t be bought by foreigners, they can’t be bought by buy-to-let landlords and they can’t be flipped around in a quick sale,” he added.

The properties would be exempt from most of the taxes imposed on new homes, such as the social housing requirement and the community infrastructure levy.

Some future regulations such as the zero carbon homes standard will also not apply to properties built under the scheme.

Communities Secretary Eric Pickles said the number of first-time buyers “is already at a seven-year high, and these starter homes… will help even more people realise their dream of home ownership.”

But doubts have been raised as to how effective the plan would be, with large numbers of young people still potentially frozen out of the housing market by high prices.

Shadow housing minister Emma Reynolds said it remained unclear how the new policy would deliver cheaper homes.

“Warm words from David Cameron about home ownership will ring hollow for those young people and families who have been priced out of home ownership over the past five years,” she said.

“This government has presided over the lowest levels of house building in peacetime since the 1920s and home ownership is at its lowest level for 30 years.”