New scheme offers 99% mortgages for first-time buyers

Treasury officials have proposed a new scheme that would allow first-time buyers to take out 99% mortgages, with the government guaranteeing the additional risk to lenders. The scheme aims to make it easier for young buyers to get on the housing ladder by requiring only a 1% deposit on their first property. A Treasury source told The Times that Jeremy Hunt, the chancellor, had asked officials to cost the scheme before next month's budget but added that an announcement might not be made until the autumn. The source added that Hunt wanted to prioritise tax cuts at the budget and that 99% mortgages could be part of a larger package to support homeownership to be announced in the autumn. Lucian Cook, head of residential research at the estate agency Savills, said that any scheme that boosted buyer numbers would need to be matched with measures to increase the housing supply. "You might be addressing the deposit affordability issue, but you're still left with the mortgage affordability issue," he said. 

The Daily Telegraph (22/02/2024)   The Times (22/02/2024)