Launch of £1m fund to help first-time buyers on to property ladder

Simon Taylor and Sophie Player look forward to buying their first home after signing up to the Simon Taylor and Sophie Player look forward to buying their first home after signing up to the "Local Lend a Hand mortgage scheme  a partnership between Norwich City Council with Lloyds Bank to help first-time buyers in Norwich. Deputy leader of Norwich City Council, Alan Waters and Lloyds Bank local mortgage manager, Andre Korolus were on hand to see the couple sign up. Photo by Simon Finlay.

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Friday, February 7, 2014
9:26 PM

First-time buyers in Norwich have been given a helping hand on to the property ladder with the launch of a £1m fund.

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Househunters Simon Taylor and Sophie Player were among the first to be approved for the scheme yesterday, which was unveiled by Norwich City Council and Lloyds Bank.

The couple said the scheme, which sees the council supplementing a buyer’s deposit to earn interest, had moved them closer to buying their first home together.

Miss Player, 27, said: “We have got a mortgage with a 5% deposit, but if we had had to find 10pc, then we would be waiting until the end of this year or even next year before being able to buy. By that time, house prices would probably have gone up again.”

Mr Taylor added: “The difference between our current rent and our mortgage will only be about £13 or £14, so it was really just a question of getting the deposit together.

The couple, who live in Bell Road, hope to complete their move to a similar home in Guernsey Road within eight weeks.

Miss Player, a nurse at the Norfolk and Norwich University Hospital said they had looked at several help-to-buy schemes.

“We thought this one was the best overall – it’s made it a little more affordable and a lot quicker,” she said.

The Local Lend a Hand scheme sees Norwich City Council and Lloyds Bank team up to help up to 40 buyers secure their first mortgage. Buyers put down a 5% deposit, with the council providing cash backing for up to a further 20%, on homes in the Norwich City Council area costing up to £160,000.

It means buyers benefit from the interest rates that come with a 25% deposit, and the council earns interest on its £1m investment, which will be taken from its reserves.

Alan Waters, deputy leader of Norwich City Council, said the scheme was part of the council’s housing strategy to “provide decent housing for all”.

He said: “Many potential first-time buyers in Norwich, including those in social housing are often unable to save a sufficient deposit, even though they could afford mortgage repayments on a typical first home.

“This initiative is designed to bridge that gap and is a wonderful opportunity for people seeking to buy their first home.”

Marc Page, mortgages director at Lloyds Bank, said: “Helping people to buy their first home is crucial in achieving and maintaining a sustainable housing market. Local Lend a Hand addresses some of the real problems that prospective buyers in Norwich might face.”

To find out more about the scheme, visit Lloyds banks in Gentleman’s Walk, Surrey Street or Aylsham Road.

What do you think? Email your views and full details to eveningnewsletters@archant.co.uk

8 comments

  • Every time some pulls a stunt like this the house prices rocket up and the very effect they are trying to achieve is lost. Although we only had one person apply for the help to buy we have noticed how much house prices are increasing. And don't think these couples are given the money. It is a loan and if they are unable to pay it back they will lose the house on default.

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    alecto

    Saturday, February 8, 2014

  • And how does this differ from the Government sponsored Help to Buy Scheme?

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    alecto

    Friday, February 7, 2014

  • Norwich City Council behind this I don;t think so. It was a George Osbourne initiative not Alan Waters ! Cheek

    Report this comment

    PaulH

    Friday, February 7, 2014

  • ....."By that time, house prices would probably have gone up again.”......Yes everyone should take on a mortgage now that they can't afford because in a years time the mortgage will be even more unaffordable.

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    Rhombus

    Sunday, February 9, 2014

  • This is really a terrible waste of taxpayer funds. I do not support tax money being used for property speculation. If there is money to be used it should be used on providing council owned accommodation not getting young people into debt. The answer is supply not false demand though increased leverage and taxpayer liabilities. House prices are clearly in a unsustainable state 300 year low interest rates, funding for lending, help to buy 1 and 2 and now our own money used in this way. If house prices would rise on their own why not stop such schemes and sell the banks etc.......they cannot as once these supports are removed the house or cards will fall that is obvious. Before the recent stimulus houses where drifting down and now with all this interference they are heading back up.... until rates rise and with 5% deposit your going to be in negative equity as thats literally a margin of negotiation not a deposit. "Mr Taylor added: “The difference between our current rent and our mortgage will only be about £13 or £14, so it was really just a question of getting the deposit together." Any rate rise of any kind will mean they are instantly worse of then they where renting. The real killer is 20% for the council this means now the council will start to be PRO expensive housing as they have skin in the game like the government does now (due to owning banks and lending schemes). Why buildgive permission for more houses and run the risk of lowering prices? IF house prices rise they will all feel like masters of finance when they do fall at some stage that 5% is going to be wiped out in a matter of months. To be brutal if the young couple want to move for a job they are probably already underwater as a buyer may want 5% if they need to sell for a new job split up. They need house prices to rise for another couple of years just to cover that 5% and their fees on top + agents commission. Houses are not cheap in Norwich a small terrace in a nice area is now 150-200,000 previously they would have been under 60K the wages have not gone up in the same manner, The explanation for the rise is the lower bank rates as people only consider the monthly payment not the liability. What I find amazing is that we had a property boom and a bust so violent that some of our largest banks had to be bought by the government. Now a few years have passed and billions of pounds in subsidies later many including our local government are so deluded they feel that this is "normal" and that young people should be buying homes for £160,000 with 5% deposit. thats 10 x times a 16,000 salary 5 x 32,000 salary and even if they are on 30,000 each (60,000) its nearly 3 x their joint salaries for a young couple who may want children. Houses have been sold on Guernsey Road for 120-130k this year so they have also paid near the very top of the sold range for this street. I bet if they had saved 10%+ they would have negotiated harder and got more than 5% off the price.

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    krisheavens

    Sunday, February 9, 2014

  • I suspect the money behind this is from Norwich City Council, but yes it is similar to the Government sponsored scheme. It is filling a gap that banks no longer wish to fill. Houses are cheap, interest rates are low but the deposit is a killer. Those of us in our 50s probably remember it being the other way round. All swings and roundabouts, good luck to this couple

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    JohnnyH

    Friday, February 7, 2014

  • Houses are cheap? Are you living in the same Norfolk the rest of us are? This is just prolonging the housing bubble. Build more decent affordable housing, as opposed to endless "executive" developments, and place clauses in the contract to prevent buy to let and make sure they go to people who want to make a home there. (Even the phrase "affordable" housing shows the problem - we only have to make a special effort because the rest of it is unaffordable.)

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    littlesharpie

    Friday, February 7, 2014

  • Just what are NCC thinking about? Encouraging people to get into debt with a bank who are partly responsible for the current state of this country due to their irresponsible lending, causing us the poor taxpayer to bail them out. This is totally wrong, why don't they go and build some flaming council houses? Shame on them, shame on them.

    Report this comment

    John L Norton

    Friday, February 7, 2014

The views expressed in the above comments do not necessarily reflect the views of this site

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