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Wednesday, 27 May 2015

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Few takers for Cumbria housing loans trumpeted as flagship scheme

JUST a handful of homeowners in Cumbria have taken part in a scheme to get low-cost loans to buy new houses.

Figures released by the government show just four people took up the Help to Buy Scheme from April to December last year in Barrow, while eight people took advantage of the scheme in Copeland and no one took up the offer in South Lakeland.

The scheme, which was introduced by the coalition government in April last year, offers low-deposit loans to help offset the cost of a mortgage.

Nationally there have been 12,875 applications for the scheme – 17 of which were in Carlisle, four in Eden and 14 in Lancaster.

The scheme was launched as a flagship scheme by the government to help reinvigorate the housing market.

Would-be home owners with a five per cent deposit can receive a 20 per cent equity loan from the government which has no interest for five years before a 1.75 per cent rate of interest kicks in, the remaining amount is then covered by a mortgage.

However, homes must be bought from a registered Help to Buy builder and homes cannot be sub-let before the fees have been repaid.

The five local authorities with the highest number of completions are Leeds with 230, Wiltshire with 224, Central Bedfordshire 197, Milton Keynes with 195 and Manchester with 169.

Jeremy Oddie, North West chairman of insolvency body, R3, said: “While we have seen signs of an upturn in the property market and an increase in demand for new homes, the recovery remains fragile and it is still too early to talk about the construction sector having turned the corner.

“It will be interesting to see whether Help to Buy has a short-term impact on the health of the home-building sector.

“It’ll be a long time before we see the type of speculative development that we witnessed during the property boom, but if growing demand can translate into new projects getting under way it may be the light at the end of the tunnel for some homebuilders.”

The Department for Communities and Local Government will release figures this month.

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