Firstbuy could lock young homebuyers into falling property market | Business | The Observer

Firstbuy could lock young homebuyers into falling property market | Business | The Observer

Campaigners are warning that George Osborne's "Firstbuy" scheme to help cash-strapped young voters onto the property ladder is a subsidy for housebuilders that could lock vulnerable buyers into a falling market.

The £250m scheme, under which homebuyers with a 5% deposit will be able to borrow a further 20% of the price of a new home from the government and housebuilders, was one of the few giveaways in the chancellor's second budget last Wednesday.

But the independent Office for Budget Responsibility expects house prices to fall by 2.3% this year, and grow by just 0.1% the year after, and many analysts are expecting sharper declines.