Mortgage News
Older first-time buyers locked out of Help to Buy
Housing minister Mark Prisk has acknowledged older first-time buyers may miss out on the government’s Help to Buy scheme.
The Homes and Communities Agency delivering the programme cannot act as a first charge lender, meaning applicants for the Help to Buy equity loan must take out a mortgage.
Prisk said: “I appreciate this may mean that some older purchasers may not be able to access the scheme.”
Older people who missed out could join a shared ownership scheme instead, he said.
He was responding to a question from Labour MP and former housing minister John Healey.
The government’s Older People Shared Ownership Scheme allows elderly home buyers to purchase between 25% and 75% of a purpose-built property. Those who purchase the maximum share do not have to pay any rent on the unowned equity.
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Age Partnership equity release technical manager Simon Chalk said those who joined a shared ownership scheme could struggle to release equity from their homes: “Providers in our market want to make sure they can sell the property without any restrictions on who the future buyer will be.”
Rather than entering owner-occupation, older people should be encouraged to look at social housing if they had not yet managed to get on the property ladder, he suggested.