£400m deal agreed to provide affordable housing

This means a first-time buyer could purchase a house worth £180,000 for as little as £126,000. As with other HomeBuy schemes, any first-time buyers whose household income is under £60,000 who cannot otherwise afford to buy will be able to apply.

The scheme will also support the house building industry by identifying buyers for their new homes, helping them to weather the current difficult conditions in the market.

Eligible first-time buyers will be able to apply for the scheme from early 2009 by contacting a HomeBuy agent in their region.

Housing Minister Margaret Beckett said: “We are determined to give families real help in the current economic climate. For many young families who aspire to own a home, the difficulties in the housing market have made the step on to the property ladder that bit harder. This deal will give them more support and put their dream of becoming home owners within reach. At the same time, this scheme will also help developers to weather the tough times in the market, by protecting jobs and helping to keep business going.”

Sir Bob Kerslake Chief Executive of the Homes and Communities Agency said: “There has been a tremendous response from developers to this scheme and we believe there is demand from purchasers who want to get on the property ladder. Our flexibility means that we have been able to add in additional funding from the National Affordable Housing Progamme to meet demand and respond quickly to the market.”

HomeBuy Direct is one of a range of schemes designed to help families to get a foot on the housing ladder. More than 110,000 people have bought their own homes through shared equity and shared ownership since 1997. The Government said it was investing £8billion over three years (2008-11) for the provision of new affordable housing for both social rent and low-cost home ownership.

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