What happens when the Help to Buy Scheme funding stops?
Rumours have been rife in the news recently suggesting the Help to Buy scheme may be scrapped, following a review by the Government.
Although, it has been stated that current Help to Buy funding is due to run out in 2021 after the Government has already promised £8.9 billion to the scheme with a further £10 billion pledged in 2017.
When the Help to Buy scheme does end, it could mean first-time buyers are again pushed out of the property market and having to live with their parents and/or renting. The introduction of the Help to Buy scheme was a lifeline for copious first-time buyers to get on the property ladder but where will it leave them now and what other options would they have if the scheme ended?
The proof of the pudding is in the stats which shows the Help to Buy scheme has been successful at getting first-time buyers on the move. The Ministry of Housing, Communities and Local Government stated that more than 420,000 people have now used the schemes to get on the housing ladder – which was launched in 2013.
Astoundingly, over 1.2 million first time buyers have opened Help to Buy ISA accounts, which offer top-up funds of up to £3,000 on top of the buyers’ savings. Furthermore, more than 420,000 completions have taken place – resulting in over 365,000 first time buyer households now on the property ladder.
Simon Bath, The Founder, and CEO of When You Move comments on the possible end of the Help to Buy Scheme and how proptech can make the property market more accessible for first-time buyers.
He said: “The home buying process can be daunting and inaccessible for many young people wishing to purchase a property, even with the Help-to-Buy scheme.
“To deal with the potentially different landscape for first-time buyers, the UK property industry as a whole needs to be more accommodating. This starts with ensuring all other available options to first-time buyers are well advertised and made as accessible as possible. LISA and the Help-to-buy ISA are great options for the new generation of home buyers – giving first-time buyers an opportunity to save a deposit, encouraging individuals to step onto the property ladder.
“However, the red tape and outdated bureaucratic practices associated with these schemes add more stages to the conveyancing process, causing further delays in the completion of a property transaction. The process needs to be simplified and streamlined to ensure the property transaction is not off-putting for anyone wishing to purchase a home.
“Digitisation in the property industry is essential in ensuring that no matter which scheme first-time buyers choose, the transaction transparent and efficient. When You Move delivers this consumer-focused approach by providing a central hub for communication between all parties involved in the transaction, through which all required documentation can be uploaded, signed and stored. The platform provides real-time updates, saving time on first-time buyers having to chase for updates”.
As a conveyancer, how will the end of the Help to Buy scheme affect you? How do you think it will affect the property marketplace?