Tuesday, 24 April 2012 3:52 PM
Grant Shapps has pledged to help what he calls the 'boxed-in generation' with his NewBuy plan, which will guarantee the mortgages of buyers of new homes.
Speaking at the Home Builders Federation (HBF) annual lunch, the housing minister said the scheme would help people who have outgrown their first property and have no room for a growing family, as well as freeing up homes for aspiring first-time buyers.
A recent survey by Findaproperty.com found that almost a third of parents – and 40 per cent of those aged under 34 - think their current home is too small for their family.
And separate research by HSBC revealed that many of the 360,000 home owners who bought their first property after 2007 are trapped in their first home and unable to move up the property ladder.
The government hopes the NewBuy guarantee will help up to 100,000 prospective and current home owners by allowing them to buy with a five per cent rather than 20 per cent deposit. The first sale went through this week.
However, the scheme has faced teething problems and criticism from two of the HBF's biggest members. Redrow Homes said yesterday that the take-up by mortgage lenders has been 'disappointing' while Persimmon has criticised the Halifax for charging too much.
Grant Shapps said: "For years increasing numbers of people have outgrown their homes but been unable to move, and first-time buyers have been unable to buy.
"The NewBuy Guarantee will give our second-time buyers a second chance, as this is the first scheme of its kind not confined to first time buyers, but available to anyone looking to buy a newly-built home."
Samantha Baden, property analyst at FindaProperty.com, said: "NewBuy widens the focus to help those who have already owned property and is expected to benefit ten times the number of buyers targeted by the FirstBuy scheme.
"While this won't solve the mortgage availability issues facing millions of first and second steppers in the UK, it's certainly a useful helping hand in the right direction."