Offer from Persimmon and Halifax to help first-time buyers

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by Kay Murchie

Persimmon and Halifax are offering a new scheme called ‘Double your Deposit’ which will help first-time buyers onto the property ladder.

Housebuilder Persimmon will provide an amount equal to however much a first-time buyer saves with mortgage lender Halifax to a maximum of £5,000.

For example, if £5,000 is saved after a minimum of 6 months, Persimmon will double this to £10,000, turning this into either a 10% deposit on a £100,000 property or 5% on a £200,000 property.

The offer comes as mform.co.uk today revealed that the average age of first-time buyers is increasing.

This is primarily due to the tightening of lending criteria which has emerged since the credit crunch. As a result, first-time buyers have to save a huge deposit in order to get a foot onto the property ladder.

As well as helping first-time buyers onto the property ladder, the new scheme from Persimmon and Halifax has been designed to encourage young people to become savers rather than spenders.

The new scheme will also help Persimmon shift their housing stock, which has been left unsold due to the mortgage drought.

Persimmon, which is Britain’s third largest house builder, has suffered as a result of the housing slowdown. It recently announced job losses and said it is facing its most challenging period in its recent history, primarily due to the reduced availability of mortgage funds and a reduction in consumer confidence.

However, Halifax, which was recently overtaken by Abbey as Britain’s largest mortgage lender, said that it would not guarantee that it would offer the buyer a mortgage.

Under the terms, the customer must make regular deposits for a minimum of 6 months. Customers must open a savings account with Halifax before January 1 2009 and before July 1 2010 to qualify.

The new scheme has met with criticism after experts said that the deal would be of limited help to first-time buyers.

Melanie Bien, of broker Savills Private Finance, said while a potential £5,000 for nothing is welcome, £10,000 won’t stretch very far.

Lenders have restricted their loan-to-values on new builds even more so than on mainstream residential lending so a significant deposit will be required, concluded Ms Bien.

Those interested in the Double your Deposit scheme should visit www.persimmonhomes.com/savings.