News article 25/01/2013

(Issued 25 January 2013) 

Home buyers in Scotland looking to move up the housing ladder now have the option of trading in their existing property in part exchange¹ for a new build up to the value of £250,000, and all with the benefit of a 95% mortgage through the MI New Home scheme.

The incentive, which is available from Monday 28 January, offers another solution to credit-worthy home owners by removing the problem of finding a buyer in the current market. Coupled with high deposit requirements averaging 25%², this can often result in a frustrating wait to purchase a new property.

This impediment is highlighted in the latest Bank of Scotland Home Movers Review, which shows that second steppers are “bearing the brunt of the stagnant housing market” as they struggle to fund deposits averaging £47,000³.

The Scottish Government supported scheme, which is also available to First Time Buyers, aims to assist those locked out of the housing market achieve their home ownership aspirations at the same time as supporting the sale of desperately needed new homes and safeguarding vital jobs and apprenticeships.

Philip Hogg, Chief Executive of home building industry body Homes for Scotland said:

“This latest announcement is a welcome addition to the wide-ranging number of benefits associated with the MI New Home scheme.

“Part exchange is just one of the solutions available to help new build customers achieve their home ownership aspirations and another key differentiator from the second-hand market.

“As well as providing confidence and reassurance through a guaranteed sale at a guaranteed price, part exchange also removes the stress and hassle which can be associated with putting your home on the open market. It also means there are no home report, estate agency or advertising costs.”

Laurence Mann, Head of Mortgages at Bank of Scotland said:

“As our research shows, many second steppers are finding it increasingly difficult to make that move up the housing ladder, which is having a considerable knock-on impact for potential first-time buyers due to the resulting shortage of properties available on the market.

“Part exchange can often offer people an easier and more affordable alternative when moving up the housing ladder, and we therefore welcome today’s addition of this option to the MI New Home scheme.”

Andrew Baddeley-Chappell, Head of Mortgage Strategy and Policy at Nationwide said:

“We are proud supporters of the MI New Home scheme in Scotland and we recognise that the introduction of part-exchange sales will give home movers a real boost.”

22 home builders across Scotland are currently participating in MI New Home with more set to join shortly⁴.
Further details on the scheme can be found at www.minewhome.co.uk .

Ends

Notes to Editors:

1. Part exchange is only available on certain plots and according to each builder’s criteria via Bank of Scotland and Nationwide

2. Source: Council of Mortgage Lenders

3. Source: Bank of Scotland Home Movers Review

4. As at 25 January 2013, the following builders are participating in MI New Home:
Bancon Homes, Mansell Homes, Barratt Homes, Merchant Homes, Bellway Homes, Miller Homes, Chap Homes, Persimmon Homes, Charles Church, Springfield, David Wilson Homes, Stewart Milne Homes, Deveron Homes, Taylor Wimpey, Lovell, Mactaggart & Mickel, Ogilvie Homes, Tulloch Homes, Kier Homes, Scotia Homes, A & J Stephen and Cruden Homes.

5. MI New Home case studies are available on request.

6. MI New Home has been developed by industry body Homes for Scotland with the support of the Scottish Government. Visit www.minewhome.co.uk for further details.