In the first quarter of the year there was an increase in the number of first time buyers purchasing properties.  The increase was due to the coming expiration on March 24 of the stamp duty holiday that had been in place for two years.  The holiday from the stamp duty would give first time buyers a savings of 1% on properties up to £250,000.  To close their mortgage loan by the expiration and save money first time buyers stepped onto the property ladder in higher numbers in the first three months of the year compared with the previous months. 

However, the stamp duty holiday had failed to stimulate the housing market as had been hoped so the government allowed the expiration to occur and did not extend the savings for first time buyers.  Instead the government backed a new scheme with builders to get first time buyers and first time movers into newly constructed homes.  The scheme will allow borrowers to get into a newly constructed property with a deposit of only 5 to 10 per cent.  This scheme is appropriately called NewBuy.

The economy needs the housing market to strengthen.  Only with a healthy housing market will recovery take hold.  It was recently revealed that the feared double dip recession had occurred in the first quarter of the year.  The contraction of economic growth in the first quarter followed a contraction in the last quarter of 2011.  It is with two consecutive quarters of negative growth that a recession is officially experienced.

NewBuy is hoped to bring a boost to the housing market and the economy.  So far very few have taken advantage of the NewBuy opportunity.  House builder Barratt has reported only one property to have been sold under NewBuy so far. 

Homeowners are in dire need of a boost to the housing market which would help their property values.  Many have experienced a loss in equity due to falling property values.  This loss in equity makes remortgaging difficult and keeps them from the cheapest remortgage interest rates.