More than 128,000 first-time buyers have got their foot on the housing ladder in the last five years thanks to the Government’s Help to Buy: Equity Loan scheme.
Another 69,000 of first timers have also benefited from the axing of stamp duty on properties below £300,000 since it was introduced in the Autumn Budget in November, the latest figures have revealed.
Now, mortgage lenders are calling for a decision to be made on the future of Help to Buy to allow for long-term planning.
Help to Buy equity was launched in April 2013 to provide a 20% loan towards the purchase of a new build property up to the value of £600,000. In London borrowers could take out a maximum equity loan of 40%.
Craig Hall, new build manager at the Legal & General mortgage club, said Help to Buy had played a ‘fundamental’ role in helping first-time buyers step onto the property ladder.
The scheme had accounted for 81% of total first-time buyer purchases and 20% of new build additions in 2017.
Hall said: “To date, this is the largest number of completions per quarter, and as numbers continue to rise year-on-year the scheme is clearly being used more than ever before by those who need it most.”
He added: “As many are aware, however, the future of the scheme has still not been guaranteed post-2021 and with an increasing number of lenders entering the Help to Buy market, we need to have a decision made sooner rather than later to allow for long term planning.”
According to the data released this week by the Ministry of Housing, Communities and Local Government, since the launch of Help to Buy equity, 158,883 properties have been bought with the loan.
Of this number, 18% (128,317) of purchases were made by first-time buyers. The average purchase price of a property bought under the scheme was £247,230 and the greatest number of homes purchased through the scheme was by people with a household income of between £30,001 and £40,000 or £400.001 and £50,000.
The figures were released at the same time the Government announced 69,000 people had benefited from the abolition of stamp duty on homes under £300,000.
Mel Stride, financial secretary to the Treasury said he was ‘proud’ the cut to stamp duty for first-time buyers was helping a new generation realise their dream of home ownership.
However, elsewhere, there was still concern that owning a property was still out of reach for many.
Mark Hayward, chief executive of NAEA Propertymark, the professional body for estate agents, said: “From December 2017 to March this year sales to the group were up to 29% on average, compared to 27% for the same period the year before.
“While this is indeed an upward swing, sales haven’t rocketed.”
He added: “We still have a long way to go to make the dream of owning a home accessible to all, but this is definitely a step in the right direction.”
The Government estimates the stamp duty cuts will help over one million people getting onto the property ladder in the next five years.
