First buyers

While the debate about how to restart the British economy rages as MPs return to parliament, one scheme that coalition ministers can point to is FirstBuy which, if you're struggling to get on to the property ladder, is one of the few affordable avenues open.

It's a government scheme that asks first time buyers to save up a five per cent deposit while the builder and government pitch in with ten per cent each, leaving 75 per cent of the purchase price to be funded with a mortgage.

Happily, this is credited with creating a recent surge in first-time buyer activity, up by nearly four per cent compared to last year

This is no surprise.

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The best aspect of the scheme is that the two equity 'loans' on offer are in effect interest free – a highly generous scheme that reflects the government and builders' desperate desire to get the property market going again, from the bottom up.

Those eligible for the scheme are first-time buyers with a household income under £60,000 but also those serving in the armed forces, council and housing association tenants, as well as private renters.

The scheme is needed badly because, although the number of first-time buyer mortgages rose over the summer, the overall picture isn't so rosy.

In 2011 187,000 people bought their first home, seven per cent less than 2010 and a fraction of the 403,000 recorded in 2006, according to the Halifax.

The causes of this, which FirstBuy tries to tackle, are clear. By the time most first-time buyers have saved up a deposit, it will too late to be of any use to the property market.

According to research by Zoopla.co.uk, even if a first-time buyer were to save 20 per cent of their gross income, it would take on average between five and 16 years to scrape together a deposit.

So given that we need to build at least 100,000 more homes every year in a bid to revive the construction industry and the economy, FirstBuy needs to become the norm, not the exception.