You are here: Home - Mortgages - First Time Buyer - News -

Buyers flock to London Help to Buy as enquiries surge

Homebuyers in London have clamoured to register for the government’s London Help to Buy scheme since its launch on 1 February.

Greg Clark, secretary of state for communities and local government, said in the scheme’s first week 15,000 people registered their interest.

Under the terms of the scheme, first or next-time buyers, can purchase a new-build property by contributing a 5% deposit from their own funds while receiving a 40% interest-free government loan for five years, allowing them to take out a mortgage of 55% loan-to-value.

The maximum purchase price for eligible properties is £600,000.

Andy Frankish, new homes director at Mortgage Advice Bureau, said the enquiry numbers were not surprising.

“The scheme has incredibly generous terms so it is no shock that it is generating a lot of interest,” he said. “It may well be that people are just curious to see what they can get and how much it will cost them.”

Frankish said after speaking to a broker, borrowers may find a shared ownership scheme is more affordable for them.

“If the enquiries do proceed to mortgage finance, homebuyers can only choose from new properties. Standing stock of new build is a really big problem,” he added. He said homebuyers were also contending with the ‘stampede’ of investors snapping up properties ahead of the 3% Stamp Duty hike which comes into force in April, putting further pressure on stocks.

Frankish said he didn’t expect to see the majority of purchase completions begin to materialise until the end of year as many of the properties people would be looking at would still be under construction.

London Help to Buy launches: your quick guide

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

The savings accounts paying the most interest

If one of your jobs this month is to get your finances in order, moving your savings to a higher paying deal i...

Coronavirus and your finances: what help can you get?

News and updates on everything to do with coronavirus and your personal finances.

Everything you need to know about being furloughed

If you’ve been ‘furloughed’ by your company, here’s what it means…

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week

Read previous post:
secret debt
Secret debt could spell relationship trouble

Discovering your partner has secret debt is the biggest financial turn-off for both men and women, according to a survey,...