July 24 2014 Latest news:

A new scheme to offer first-time buyers an alternative option to get a foot on the first rung of the housing ladder has been launched.

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The FirstBuy scheme, specifically designed to help those struggling to buy their first home due to the need for large deposits, will be supported by more than 100 housebuilders.

The project has been touted by the government as an alternative to using the ‘Bank of Mum and Dad’.

Housing minister Grant Shapps has encouraged aspiring first-time buyers across the country to come forward and take advantage of the offer.

Through FirstBuy, the government and housebuilders together will offer a 20pc equity loan, which alongside a 5pc deposit from the buyer will enable them to take out a 75pc mortgage on the rest of the property.

Loans will be repaid on resale of the property, with the government’s share available for reinvestment in more affordable housing.

The first homes are expected to be available in September.

FirstBuy is set to help more than 10,000 first time buyers in England over the next two years, with up to £500m available across the UK.

Because the scheme is only available on new-build properties, the government said it will offer a much-needed shot in the arm to the housing market and the construction industry, supporting thousands of jobs.

Subject to contracts signed over the summer, housebuilders that will be able to offer homes for sale through FirstBuy will include Persimmon Homes, Barratt Homes and Bovis Homes Limited.

Key lenders backing FirstBuy by preparing to offer 75pc mortgages to those first-time buyers making the most of the scheme include Halifax, Nationwide, Barclays and The Melton Mowbray Building Society.

Mr Shapps said: “With 80pc of young first-time buyers depending on parental help, I am determined that we pull out all the stops to help those who want to take their first steps onto the property ladder.

“FirstBuy will do just that. Over the next two years, this will help as many as 10,000 people in England to get that much-needed deposit together and realise their dreams of owning their own home.”

Stewart Baseley, executive chairman of the Housebuilders Federation, said: “Firstbuy will help first time buyers, boost economic growth and provide a vital shot in the arm for the house-building industry.

“Our members have reacted decisively to support FirstBuy and recognise the scheme is an important first step.”

Those looking to buy their first home should contact their local HomeBuy Agent to register their interest in the scheme. Visit www.homebuy.co.uk.

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