Government trumpets 150,000 Help to Buy completions.
Government trumpets 150,000 Help to Buy completions. 150,000 completions have been made under the Department for Communities and Local Government’s Help to Buy equity loan and mortgage guarantee programme since it’s inception two years ago, although 32,000 of such purchases are not first time buyers.
Half of those 150,000 homes purchased have been new build homes, with 95% outside London according to the government. Leading housebuilders Taylor Wimpey, Persimmon and Barratt have all announced big increases in profits in recent weeks. Barratt in particular who say they have sold 32% of their homes under the scheme, announced 2015’s pre tax profits grew by 34%.
Housing Minister Brandon Lewis said: “Help to Buy has now helped more than 150,000 people across the country achieve their aspiration of buying a new or bigger home.
“These figures show the continued success of Help to Buy in supporting many hardworking people who want to buy their own home.
“We know there is more work to be done to get the homes built people want but it is great news that people are really taking the opportunities available and getting into ownership.”
Chancellor of the Exchequer George Osborne said: “The government is committed to helping people achieve the aspiration of buying their own home, and all our Help to Buy schemes have now helped almost half a million people.
“While the stronger financial system means we expect banks to start to exit our Help to Buy Mortgage Guarantee scheme, the other Help to Buy schemes go from strength to strength.
“The Help to Buy ISA, launched in December 2015 has already helped a quarter of a million people save for their first home by providing a bonus of up to £3,000.”
However Doug Crawford, CEO of My Home Move was unimpressed: “In the news we are constantly being reminded of today’s record low interest rates and the competitive mortgage deals on the market, however with ballooning house prices, there is little light at the end of the tunnel for those aspiring to be a homeowner.
“First time buyers are especially missing out in today’s market due to a dwindling supply of housing for sale and shortage of suitable homes. The Help to Buy equity loan scheme has made some headway in addressing this freefall by offering a loan of up to 20% of the property price. From its launch in April 2013 until the end of 2015, the data shows that the majority are taking the maximum loan available. The typical borrower under the scheme has borrowed a fifth of a £220,825 property value – the maximum loan available to them.
“We are now seeing high numbers of those using the HTB scheme also relying on a gifted deposit for the upfront cash required. Our own data showed that 47% of HTB properties were purchased with a gifted deposit last year.*Affordability issues are at the core of the struggle to get on the housing ladder, especially in areas with high demand where the average price of new dwellings is rocketing. In Q4 2015 new build properties were priced at £404,000 in the South-East and jumped to £490,000 in London.
“Further action is still fundamental to helping the housing crisis for those who are working hard to become a homeowner and are simply priced out.”