First-time buyers have been the main recipients of Government’s Help to Buy equity scheme, representing more than 80% of borrowers taking out the loan since its launch.
First-time buyers have been the main recipients of Government’s Help to Buy equity scheme, representing more than 80% of borrowers taking out the loan since its launch.
New data providing an insight into how the scheme, which provides loans towards the deposit on new build homes, has fared revealed 196,102 properties have been purchased under the initiative.
A total of £8.93 million has been loaned to borrowers through Help to Buy since it started in April 2013 until March 2018 and it has supported the purchase of properties worth a total of £42.23 billion.
But it seems to be the first-time buyers who have received the greatest boost from the loan, with 81% of home purchases through the scheme being made by those taking their initial step on to the housing ladder.
Extra support
Steve Seal, director of sales and marketing at Bluestone Mortgages, said the statistics, which were compiled by the Ministry for Housing, Communities and Local Government, highlighted the sheer number of borrowers relying on Help to Buy.
He added: “It’s great to see the development of these schemes designed to assist consumers who would otherwise struggle to access the property ladder.
“The market contains pockets of borrowers like first-time buyers, who require extra support to reach their homeownership aspirations, particularly as the cost of living becomes ever more expensive. As an industry it is essential that we ensure that provisions are in place to cater to a wide range of needs.”
According to the data, the average price of a property bought under the scheme was £249,708 and the average equity loan was £52,834.
In London, where the maximum loan borrowers can take out from the Government is 40% – compared to 20% for the rest of the UK – there have been 7,978 completions. Of these, 6,548 were taken out with a loan of more than 20%, demonstrating buyers in the capital are utilising the higher limit.
More supply needed
Craig Hall, new build manager at Legal & General Mortgage Club, said this data revealed how Help to Buy had become an important part of our housing market.
But, he said, going forward there was still more to be done to help people onto the property ladder.
“It’s no secret that we need to build over 300,000 new homes a year to keep up with demand,” he said, “and the Government will need to find a range of solutions in order to help meet this target.
“Whether it’s guaranteeing the scheme post-2021, increasing support for other affordable schemes such as Shared Ownership, or relaxing planning restrictions, we need new supply entering the market – stimulating growth and allowing it to better serve those who need it most.”
