Over 50% of those who used a government scheme to help them purchase a home did not need it.
According to recent research, around 4,000 homes in England earning over £100,000 per annum have used the Help to Buy Equity Loan scheme.
Official data also indicates that it’s not necessarily first-time buyers who are getting government help; the figures show that over 20,000 households are already on the property ladder when they enter a scheme.
Introduced in April 2013, the original aim of the initiative was to make purchasing a home more affordable.
However, government figures show that 57% who signed up stated that that could have afforded to buy a property, without the extra help from the scheme.
Building the housing supply was another reason behind the introduction of Help to Buy. For newly-built properties, the government provides buyers with a 20% equity loan, a proportion which rises to 40% in London on properties with a value up to £600,000.
A 5% deposit is required, with the loan being taken back by the government when the property is sold.
Therefore, if the value of the property increases, the government will make a profit.
Although similar schemes were also implemented in Wales and Scotland, these have now ended.
Within England, the government has stated that is has designated £8.6 billion for the Help to Buy Equity Loan scheme – set to run until 2021.
Commenting on the falling numbers of young homeowners was John Healey. The shadow housing secretary for Labour highlighted the need to prioritise this demographic when it came to the housing ladder.
“While the number of younger people who own a first home is in freefall, the number of government-backed affordable homes to buy has fallen by two-thirds since 2010 and badly targeted schemes like Help to Buy are not focused on those who most need a hand up.
“Labour would change that and make helping first-time buyers on ordinary incomes the priority for Help to Buy.”
Also sharing his view on the findings was Gavin Barwell, the housing and planning minister, who stated: “We’re committed to helping more people find a home of their own with the support of a range of low-cost home ownership products.
“Our Help to Buy Equity Loan scheme continues to make home ownership a reality for thousands of people, especially first-time buyers right across the country.”
