New 5% Deposit Home Ownership Schemes: Your Path to Affordable Property
Great news for new home buyers! Housebuilders Barratt Redrow and Persimmon have teamed up with lenders Barclays and TSB to launch an exciting new 5% deposit home ownership scheme. This is a golden opportunity for first-time buyers looking to step onto the property ladder with a low deposit. Let’s dive into how the scheme works and explore other 5% deposit options available for purchasing a new-build home.
Introducing the Rezide Equity Loan, a new scheme designed to help buyers purchase a new-build home with just a 5% deposit. While it’s similar to the previous Help to Buy scheme, which ended in 2023, it’s tailored for those who are struggling with affordability. This private-sector initiative offers an alternative way for first-time buyers to make their homeownership dreams come true.
The Rezide Equity Loan covers 15% of the property’s market value (up to £100,000), leaving you to finance the remaining 80% with a mortgage from either Barclays or TSB. The loan comes with a fixed interest rate of 4%, and you don’t have to make repayments until the property is sold or the mortgage matures. You can also pay off the loan early without any penalties. It’s designed to give you flexibility, while making homeownership more accessible.
With the end of the government-backed Help to Buy initiative, many aspiring homeowners were left without affordable options. This challenge was highlighted by Adrian MacDiarmid, Barratt Redrow’s Head of Mortgages, who explained that many people feel homeownership is out of reach. The Rezide Equity Loan aims to fill this gap by offering a 5% deposit solution that makes it easier to buy a new-build property.
The Rezide Equity Loan is available across England, initially for buyers purchasing a qualifying new-build home from Barratt Redrow or Persimmon. Some of the well-known brands included are:
However, this scheme is not open to everyone—eligibility is subject to affordability and availability checks. It’s also important to note that this is a privately funded scheme, not a government initiative.
If the Rezide scheme isn’t quite what you’re looking for, there are other 5% deposit options available, such as the Deposit Unlock scheme. Developed by the Home Builders Federation (HBF), this option allows first-time buyers and home movers to purchase a new-build home with just a 5% deposit using a 95% mortgage with competitive interest rates.
With Deposit Unlock, instead of an equity loan, you’ll secure a 95% mortgage. The scheme is backed by a mortgage indemnity policy, funded by the housebuilder, which allows for more competitive mortgage rates. Over 80 housebuilders are participating in the scheme, making it a flexible option for those looking for a new-build home with a 5% deposit.
Unlike some other schemes, Deposit Unlock is not limited to first-time buyers. Home movers can also take advantage of this offer, and properties are available up to a value of £833,250. A full list of participating housebuilders is available on the Deposit Unlock website.
Many developers also offer their own deposit schemes, which can be a great way to reduce the amount you need to save for a deposit. These offers may include contributions of 5% or a fixed amount, such as £10,000.
For instance, Miller Homes offers a Deposit Paid scheme, where they will contribute 5% of the purchase price towards your deposit on selected properties. Similarly, Barratt Homes has a Deposit Boost scheme, where they will match your 5% deposit, giving you a 10% deposit in total on selected plots.
If you’re looking to buy a new-build home with a 5% deposit, the first step is to explore the available schemes and find a development that suits your budget. Whether it’s the Rezide Equity Loan, Deposit Unlock, or a developer-specific offer, make sure to contact the developer’s sales team to discuss the options available. Don’t forget to check out listings on our website for homes that feature these deposit offers.
Ready to start your journey to homeownership? Explore the options that could help you secure your new home with just a 5% deposit. The dream of owning a home is within reach!
