Government consults on proposals for discounted homes for 100,000 first-time buyers

Out-Law News | 16 Dec 2014 | 4:20 pm | 1 min. read

The UK government has opened a consultation (21-page / 538 KB PDF) seeking the views of developers and councils on proposals to offer 100,000 first-time buyers new homes at a 20% discount.

Under the government's proposed Starter Homes Initiative, developers would benefit from reduced planning costs in order to enable them to bring forward under-used or unviable brownfield sites for the development of homes. The homes would then be sold to first-time buyers under the age of 40 at a discount of at least 20% from market value.

A proposed change to the planning system would exempt participating developers from having to pay section 106 affordable housing charges and tariffs, which the government said could amount to "an average bill of £15,000 per home". Developers would also be exempt from community infrastructure charges. Homes built by developers with the benefit of the exemptions would then not be able to be sold at market value for a fixed period, proposed at between five and 15 years.

The proposals also included the introduction of a design panel to ensure that the homes delivered were "high quality and well-designed". The government said in a statement that the panel would include "world famous architects such as Sir Terry Farrell and Sir Quinlan Terry".

The government said that the scheme would be open to expressions of interest from 100,000 prospective buyers from early in 2015 and that the proposals had the backing of more than 30 house builders and "councils from up and down the country".

The proposals were welcomed by real estate investors' trade body the British Property Federation (BPF). BPF chief executive Liz Peace said: "The housing shortage in the UK is acute, and while this initiative alone will not be enough to solve the housing crisis, it will certainly help boost the number of badly needed new homes coming on to the market."

"Bringing brownfield land back in to use is often difficult for developers as the expense can threaten a project's viability," said Peace. "Introducing an incentive to build on brownfield sites should therefore help to unlock new homes."

The consultation is open until 15 February.