Only 19% of First Time Buyers take advantage of homeownership schemes; nearly £7 billion a year in free government funding is left untouched by first-time buyers, while only 28% know what shared ownership is.
First Time Buyers are missing out on vital home ownership schemes. Surprising survey results from TotallyMoney survey reveal that 80% of first-time buyers who purchased through the Government’s Shared Ownership scheme didn’t know what ‘leasehold’ meant.
Only 19% of property buyers in the last 10 years have used a government buying scheme to secure their property, with a smaller 6% having used the government’s Shared Ownership scheme.
Amongst those surveyed, the results revealed that the British public’s lack of knowledge on the Shared Ownership scheme is deterring them from using it to their benefit. While 40% of first-time property buyers surveyed admitted they needed financial support from family and friends to buy, even with a mortgage, only 19% had utilised a government-backed scheme, and only 6% had taken advantage of Shared Ownership.
In addition, once presented with the correct definition of the Shared Ownership scheme, 38% of first-time buyers would still not consider buying through the Shared Ownership scheme. When questioned as to why this was the case, 35% stated that fear over hidden additional fees would deter them from utilising the scheme.
A TotallyMoney spokesperson said, “With entering the property ladder becoming increasingly difficult, and with this step being so important to many, it’s important to clear the smoke that exists around the schemes existing for first time buyers today in order to help them make the best financial decision.
“Though many do not have a rounded understanding of what the Government Shared Ownership Scheme is, for those that do understand it can be a useful tool to become a homeowner. We have conducted this research and created this guide to open up understanding on Shared Ownership for those looking to buy so that they too can take advantage of it.”
OneFamily research has revealed of the 7.4 million first-time buyers in the UK eligible for a Lifetime ISA, only one in twenty (6%) are taking advantage of the additional £1,000 savings top-up a year being offered by the government.
Similarly, the low uptake is being driven by a lack of awareness with over half (55%) of 18-39-year old first-time buyers saying they had never heard of the Lifetime ISA or if they had heard of it, they didn’t know what it was.
Nici Audhlam-Gardiner, Managing Director of Lifetime ISAs said, “The Lifetime ISA should be a no-brainer for first-time buyers, as there isn’t a product that competes with it for the bonus you get back on your savings, plus the potential investment returns. First-time buyers can also use it for that all-important house deposit, which is one of the biggest flaws with the Help to Buy ISA, as savings can only be accessed after completion.
“This research shows that millions of first-time buyers aren’t making the most of the generous bonuses on offer to them at no cost, and are losing out on additional returns by saving in cash.”