A little bit of good news came out of last week’s budget for the first time buyers market at least when the government announced their plan for a new shared equity scheme for first-time buyers, this will obviously offer a little strengthening of the housing market as it opens the door for many buyers that simply were not in a position to pull together a large deposit. At least 10,000 first-time buyers will be eligible for the Firstbuy scheme, announced by Chancellor George Osborne. The House Builders Federation welcomed the move and said it would have economic and social benefits. However, the £250m government pledge to the scheme will only last for one year, so any first time buyers that wish to take advantage of the scheme needs to get their skates on. First-time buyers have been struggling to get a foot on the housing ladder. Latest reports show that only just over 2% of new mortgage lending in the final three months of 2010 was to those who could offer a small deposit of less than 10% of a home’s value. The Firstbuy scheme would see the government and house builders offer loan help for first-time buyers purchasing a newly-built home. Buyers must save a deposit worth 5% of their property’s value, with the government and house builders putting up 10% each through an equity loan, enabling people to qualify for 75% loan-to-value mortgage. The equity loan would be interest-free for the first five years, with interest charged at 1.75% in year six, and at inflation plus 1% thereafter. There was an apparent mixed review from the financial world following the announcement last week with some suggesting that the scheme seems to encourage first-time buyers to purchase property with very high loan-to-value ratios. Given that the credit crunch was largely caused by people borrowing more than they could afford to repay, the obvious worry is that we don’t end up repeating the mistakes of the past. I believe responsible lending weighs heavily on most people’s minds today and no one would want to see a repeat of the irresponsible lending that went on in 2007.Enough people have had their fingers burned at this point to force then to remain sensible and live within their means. There are plenty of responsible buyers out there that are in a position to buy but just don’t have a large enough deposit and as long as they do the math I think this new scheme could be a little silver lining that they have been wishing for and at the same time inject some much needed cash into the static property market that has remained at the mercy of the lenders for sometime now.