News Column

Help to Buy helps almost 13,000 homebuyers

January 28, 2014

Hilary Osborne, theguardian.com

Almost 13,000 homebuyers took out interest-free Help to Buy loans in the first nine months that the government's scheme to kick-start the housing market has been running, figures show. The equity loan scheme, which went live in April, allows first-time buyers and movers to borrow up 20% of the purchase price of a new-build property as long as they can afford a deposit of at least 5%. No interest is paid for the first five years, and it can be paid back on the sale of the property. The communities and local government department said that by December 12,875 properties had been bought through the scheme the equivalent of 46 a day and a further 6,446 sales were in the pipeline. Major housebuilders have reported an increase in activity driven by Help to Buy, and on Tuesday Crest Nicholson said it was a factor in its 40% rise in profits, accounting for 600 sales. The figures showed a wide geographical spread for use of the scheme, with the most completions taking place in Leeds, Wiltshire and central Bedfordshire. Across the 32 London boroughs there were 810 Help to Buy sales 6% of overall sales in the capital. The government said around 90% of sales of newly built homes through Help to Buy had been made to first-time buyers, while the housing minister, Kris Hopkins , said he was "delighted" with the figures. "With each of these sales being a newly built home I am also pleased that housebuilders are using this momentum to build more, getting workers back on sites and getting Britain building once again," he said. "All this is a key part of our long-term economic plan, helping to bring housebuilding to its highest level since 2007, and orders for construction materials are at a 10-year high." The second part of the government's Help to Buy scheme went live in October. It offers lenders a taxpayer-backed guarantee to encourage them to make loans to borrowers with small deposits, and has been criticised for encouraging demand for homes without boosting supply.


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Source: Guardian Web


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