Mortgages will be standard on a new wave of Government starter homes to deter cash buyers, according to today’s housing white paper.
The paper, published by the Department for Communities and Local Government, says the Government will update its national planning policy to make starter homes available to households with an income of less than £80,000, or £90,000 for London.
But the paper adds: “Eligible first time buyers will also be required to have a mortgage in order to buy starter homes to stop cash buyers.”
The DCLG wants a 15-year repayment period for a starter home, so if the home is sold on within the timeframe then some or all of the discount will be repaid.
The white paper adds: “This, along with the mortgage requirement, will reduce the risk of speculation, ensure there will be more affordable homes built whilst allowing home owners to move onwards when the time is right.”
The white paper says the Government will fix Britain’s “broken housing market” by promoting affordable house building and cheaper rents.