Housebuilders Barratt Redrow and Persimmon have created a loan product designed to make home ownership more accessible and affordable.
The Rezide Equity Loan will be supported by Barclays and TSB and aims to support individuals and families who have struggled to step on to the new-build property ladder due to deposit constraints.
It enables prospective buyers to buy a new build home with a significantly reduced upfront investment.
Under the Rezide scheme, homebuyers will need to provide just 5 per cent equity deposit, while a Rezide Equity Loan will cover 15 per cent of the property’s market value up to a maximum loan amount of £100,000.
The remaining 80 per cent of the purchase price will be financed through a mortgage from Barclays or TSB.
Barclays UK head of mortgages, Lee Chiswell, said: “Barclays has been focused on making home ownership more affordable for first-time buyers and movers, introducing various enhancements to our new build proposition in the last year.
“We’re delighted to join this initiative and help yet more people get on the property ladder.
“We’ll be accepting applications for this unique proposition from day one and hope it helps make that dream home a reality for many.”
According to the housebuilders, the initiative represents a “major step forward” in addressing affordability challenges and helping more people achieve the goal of home ownership.
The equity product will initially be exclusively for buyers of Barratt Redrow and Persimmon homes, with the scheme being rolled out across England.
This scheme has been designed to support both first-time buyers entering the property market, as well as those seeking to move into new build homes who might otherwise struggle to afford a property,
Barratt Redrow head of mortgages, Adrian MacDiarmid, added: “Affordability remains a big challenge for many people — not just first-time buyers but also growing families looking to trade up or people wanting a smaller home coming out of a relationship.
“Since Help to Buy ended many people have felt home ownership is beyond them.
“This is why we have worked across the industry to design a mortgage for people to buy a new build property with just a 5 per cent deposit — helping make the home ownership dream a reality for them.”
Launched in the wake of the withdrawal of government support schemes like Help-to-Buy, this initiative highlights a collaborative approach within the new build housing sector.
tom.dunstan@ft.com
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