The latest efforts to kick-start a moribund mortgage market for first-time buyers are finally gaining momentum after a slow start, the boss of housebuilder Persimmon said yesterday.
The Government's NewBuy scheme, launched in March, sees housebuilders pay into a Guernsey-based fund insuring lenders against 95 per cent of potential losses on mortgages.
The guarantee is designed to encourage banks to lend at cheaper rates to first-time buyers as well as existing homeowners with little equity in their properties.
Persimmon has sold 220 new homes under NewBuy, representing around 5 per cent of its 4712 sales total in the first half of this year. The industry hopes NewBuy could deliver an extra 100,000 homes.
Despite the summer slowdown, Persimmon forward sales are 4 per cent up on last year at £1.04bn. Pre-tax profits jumped 65 per cent to £98.7m.