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"Early success" sees NewBuy notch up 400 reservations

Monday, May 21, 2012

The government's NewBuy scheme has notched up 400 reservations already, according to the Home Builders Federation, leading them to declare the scheme an "early success".

The new figures, released last week, saw a strong response to the new scheme, which launched nine weeks ago, just as the HBF revealed further falls in housing starts across the UK, demonstrating why NewBuy is vital for home buyers and the industry.

With the home-buying process taking some weeks these figures reveal a remarkable start for a scheme only introduced on 12th March, the HBF said, expecting to deliver "tens of thousands of sales over the next three years".

This milestone was announced on the day that official statistics showed a 15% drop in housing starts in Q1 of 2012 compared to 2011 to just 24,140. "At a time when we are already building fewer homes than since the 1920's, and fewer than half those required to meet housing need, the figures further emphasise the value of Newbuy to home buyers, the industry and the economy," read the report.

Around 60,000 starts per quarter are needed to meet housing demand.  The country is facing an acute housing crisis, with millions on social housing waiting lists and first time buyers unable to buy, largely because they can't afford the deposit required to secure a mortgage.

NewBuy, an industry funded Government backed mortgage indemnity scheme, allows buyers to secure their new build home with a 5% deposit. Since its launch in March, the number of builders and lenders registering for NewBuy has steadily increased, with the fifth lender, Santander launching its NewBuy product last week.  

Stewart Baseley, Executive Chairman of HBF, who were part of the team that developed the NewBuy scheme said: "Reaching 400 NewBuy reservations within weeks of its launch is a fantastic start and clearly demonstrates the customer demand for this vital scheme. These figures make us very confident that the scheme will deliver tens of thousands of sales over the coming years.

"As today's house building statistics show, we have an acute housing delivery problem. By enabling home buyers to purchase a new home, NewBuy will kick-start new home construction, creating economic growth and thousands of jobs across the country."

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