Govt announces new loans for house buyers

3 September 2008

First-time buyers in England may benefit from a new government loan scheme, it has been revealed.

Under the scheme - which is known as HomeBuy Direct - people seeking to get on to the property ladder who have a household income of less than £60,000 will be offered loans worth up to 30 per cent of the value of their desired property.

This credit will remain interest-free for five years.

According to government estimates, up to 10,000 first-time buyers in England will be able to take advantage of the offer.

The move is an attempt by the government to stimulate the housing market in the wake of banking problems which have resulted in a stagnation of house sales.

In a further incentive to potential home-buyers who may be concerned about their personal finances, the Labour administration has also revealed it is axing stamp duty on properties worth less than £175,000 for the next year.

Meanwhile, according to recent Land Registry figures, house prices in England and Wales fell two per cent over the last year, with the average price of a property standing at £178,364 at the end of July.

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