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Strong start to 2012 for new homes market

"The new homes market has seen a strong start to the year, with a flurry of new scheme launches, encouraging levels of activity from buyers and new mortgage products announced by lenders which are designed to attract customers.  January trading statements from leading housebuilders have been extremely optimistic, reporting a strong start to the selling season despite wider economic uncertainty.

"We could see a fall in activity at the lower end of the market after 24th March, when first time buyers are again required to pay stamp duty tax on properties under £250,000, but the fact that many developers are offering their own extensions to the stamp duty holiday means it is unlikely to have a serious impact. I am confident that the launch of the NewBuy Mortgage Indemnity scheme later in the spring, which will see the Government underwrite potential losses on new build property to help first time buyers borrow up to 95%, will drive demand."

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