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Do you want to buy your first home?
Or move on to your next property? The government-backed Homebuy Direct scheme makes buying new build property more affordable.

The scheme is targeted at first time buyers who cannot afford to buy a suitable property on the open market without assistance in the area where they live or work.

Although the scheme is targeted at first time buyers, it could also help people who have previously owned properties but are now unable to buy without assistance, for example in the case of relationship breakdowns or families who are over-crowded in their existing homes.

You can apply for Homebuy if your household income is less than £60,000 per year.

You will need to buy a minimum 70% share in a home (maximum initial share that can be purchased is 85%), with the share you do not buy being funded by an equity loan of up to 30% of the purchase price. The loan will be jointly funded by Government and the developer on a 50/50 basis.

Remember: Property prices can go down as well as up. You should always get independent financial advice from a qualified financial advisor before buying any property.

Please note: Newcastle City Council is not involved in the Homebuy Direct Scheme and is providing this site for information only.

How Homebuy Direct works 

• You pay for at least 70% of the purchase price using a mortgage and any deposit.
• You get a loan to pay for the rest. This loan is jointly funded by the government and the developer who built the property.
• You don’t have to pay anything for the loan for the first five years. After six years you will pay a charge on the equity loan of 1.75% of the initial market value of the home. This charge rises annually thereafter by the Retail Price Index plus 1%.
• You can pay back all or part of the loan if you want to. You can do this in installments. 
• You can sell your home on the open market. When you do so, you will repay any remaining loan by giving the government and the developer a share of the sale proceeds. (This share will be divided equally between the government and the developer.)
• If the value of your property has increased by the time it is sold, you, the developer and the government will all share in this increase.

If the value of your property has gone down, the government and the developer will only share the sale proceeds that are left over once your mortgage has been repaid.

For further information on any of the Homebuy products please contact the NomadE5 Home Ownership team on 0191 292 2749 or by email to nomad.homebuy@nomade5.co.uk.

NomadE5 is part of the ISOS housing group.

Page last updated: 16 August, 2011