First Time Buyer
Government confirms there are no plans to extend or replace Help to Buy
The government is not planning to extend or replace the Help to Buy scheme after it officially ends on 31 March, the housing minister has confirmed.
The Help to Buy Equity Loan schemed offered first-time buyers the chance to purchase a new-build property with a minimum 5% deposit. They could also use an equity loan of up to 20% of the purchase price – or 40% in London – where the loan is interest-free for the first five years.
It closed to new applicants on 31 October 2022, while all transactions must be completed by 31 March 2023.
In December, the Welsh government extended the Help to Buy scheme until 2025, but in England, the Government is sticking with the deadline already set.
Responding to a question from Mark Fletcher, MP for Bolsover, about what steps were being taken to help first-time buyers, Lucy Frazer, Minister of State for Housing and Planning, said: “There are currently no plans to further extend or replace Help to Buy, but all options to increase home ownership are kept under review.
“Our other schemes, including shared ownership, the mortgage guarantee scheme and First Homes, which have been trialled in my hon. friend’s constituency, continue to support first-time buyers.”
The First Homes scheme was announced in 2021, following a trial in Bolsover, Derbyshire. It allows new buyers to get a discount of between 30-50% off the value of their property and is subject to regional price caps.
The scheme then launched in June that year with seven lenders signed up including Chorley Building Society, Darlington Building Society, Halifax, Leeds Building Society, Mansfield Building Society, Nationwide Building Society and Newcastle Building Society.
Products to support the scheme were introduced throughout 2022.
Fletcher said Help to Buy had been an “invaluable” way for first-time buyers to get onto the property ladder and asked if the scheme could continue.
Since its introduction in 2013, just over 361,000 properties were bought under the scheme, with the total value of equity loans totalling £22.5bn.
Frazer said: “We do not currently have plans to do so, but we will keep that under review.”
She added that since 2010, government-backed schemes had supported 819,000 households to purchase a home, including the stamp duty holiday and the extension of the mortgage guarantee scheme.
Related: End of Help to Buy: 10 alternative for first-time buyers.
