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Government ‘starter homes’ will be a non-starter in the East Midlands

In the Autumn Statement last week, George Osborne announced 200,000 new Starter Homes to help young first time buyers under age 40 purchase a home at a 20% discount.

But research by the Labour has revealed that despite government claims, starter homes will be unaffordable for many people in the East Midlands.

The average price of a starter home in the region will be £172,181 by 2020. On average, this could mean first time buyers need an income of £46,726 and a deposit of £36,675.

Starter homes have been criticised for being out of the reach of first time buyers on middle incomes. Research by Shelter published in August found that for families on average incomes starter homes would be unaffordable in most of the country.
 
Critics have also pointed out that because starter homes are being funded at the expense of affordable homes to rent and buy, they could mean the loss of tens of thousands of homes for social rent and shared ownership over the next five years alone.
 
In amendments to the Housing and Planning Bill, Labour is seeking to make starter homes more affordable, and built additional to, rather than at the expense of, public homes to rent and buy.
 
Labour's Shadow Cabinet Minister for Housing and Planning, John Healey MP, said:
 
"My fear is that young people and their parents who are hoping for help with the cost of buying a place of their own will find David Cameron’s plan proves a false promise.
 
“The closer people look, the less convinced they are about the way starter homes have been set up. Conservative MPs are already critical, and others will voice doubts as the Bill is debated in Parliament.

"The truth is the housing market is stacked against families and young people on middle incomes, and this government has no credible plan to fix it.
 
"Home-ownership has fallen each and every year in the last five years, and will continue to be out of reach for far too many people unless we re-think how to mend England's broken housing market."
 

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