Housing Regeneration and Heritage Minister Huw Lewis today called upon mortgage lenders and homebuilders to sign up to deliver the NewBuy Cymru scheme at a special event to inform the industry of the details of the scheme.
Plans for NewBuy Cymru, were announced in November last year, and since then, work has been underway to develop the detail of the initiative. The event at the Millennium Stadium, which included a key note address from the Minister and presentations from the Home Builders Federation and scheme administrators Jardine Lloyd Thompson, provided businesses with an opportunity to learn more about the scheme and to take part in a question and answer session.
NewBuy Cymru will be available to all buyerls in Wales, subject to fulfilling lending criteria, and will support the purchase of up to 3,000 new build homes up to value of £250,000. The Welsh Government and house builders will act as guarantors so that buyers can secure high loan to value mortgages that would not otherwise be available to them. Buyers will contribute a 5% deposit. The scheme, which the Welsh Government is supporting with a guarantee, could enable an investment in housing of up to £500m within a five year period.
The Minister said; “We are all more than aware that we are working in very difficult economic times which are having a significant negative impact on all aspects of the housing market. But we mustn’t let these difficulties stop us doing what we can to help the housing system work more effectively. Nor should it stop us being ambitious.
“Our mortgage guarantee scheme NewBuy Cymru is one intervention that can help us fulfil this ambition. I confirmed the Welsh Government’s support for this scheme in November last year and since then, considerable interest has been expressed in the scheme. I want this scheme to help up to 3,000 households to buy their first house or move up the housing ladder.
“If we achieve 3,000 sales at the average price of a new home, this could mean sales of up to a value of £0.5 billion across Wales, and with estimates that for every £1 spent on house-building, £1.40 in gross output will be generated across the economy as a whole, this is quite a contribution to the Welsh economy.
“We now need you all to become active to make NewBuy Cymru a great success. Not only do we need you to sign up to the scheme, but also to actively market it. This will help the scheme to deliver to its full potential for both the economy and for families and individuals across Wales and I look forward to being able to officially launch NewBuy Cymru in the near future.”
Paul Smee, director general of the Council of Mortgage Lenders, said; “NewBuy Cymru will be a welcome addition to the range of options in Wales designed to make it easier for good borrowers with only modest deposits to buy a home. We look forward to working with our members and others to deliver the new scheme successfully."
Stewart Baseley, Executive Chairman at the Home Builders Federation said;
“Newbuy Cymru is great news for Wales. It will help frustrated first time buyers currently unable to buy a home because the deposit required is too large, and those stuck without enough equity in their current home to move. It will also mean homes Wales desperately needs are built, creating jobs and boosting the economy. “
Steven Rance, Partner at Jardine Lloyd Thompson added; “JLT are pleased to be involved in delivering this exciting initiative which will no doubt prove beneficial to both house builders in Wales and potential purchasers who are keen to buy a new build home with just a 5% deposit.”