12th March 2012
Scott Mellors, FRICS, Senior Partner of John German, once again expressed a note of caution with the NewBuy Scheme announced this week to help buyers who wish to borrow 95% against the purchase of a new property.
"On the one hand, measures to assist home buyers are welcome after four years of falling numbers of new homeowners - but on the other, I am concerned at the prospect of a two tier market creating different momentum in house values".
"This initiative comes at a time when second hand house values are falling slightly in many parts of the country at the same time as premiums on new homes are increasing."
"Buyers of a new home need to realise that this is not an advantage that can be passed on when they sell the property."
"Their 'once new' house will be sold in a market place that does not have the government backed scheme. At the end of the day the health of the entire housing market is of paramount importance."
"In my view this piecemeal approach carries some risk to the buyer and ultimately the taxpayer if second hand house prices and new house prices become distinctly two paced", concluded Scott.