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

Help to Buy scheme extended to 2023 for first-time buyers

0
Written by:
30/10/2018
The Help to Buy Equity scheme will be extended for a further two years but for first-time buyers only.

The scheme aims to help struggling buyers onto the property ladder by offering loans of up to 20% of the property’s value to people with a 5% deposit. They then take out a mortgage for the remaining 75% from a participating mortgage lender.

Help to Buy was meant to end in 2021 but will now run until 2023 when it will be scrapped altogether.

In the Budget notes, the government said the extended scheme (from 2021) will be restricted to first-time buyers only and to houses with a market value up to new regional price caps, including £186,100 in the north east stretching up to £600,000 in London.

Analysis published alongside the Budget reveals that the scheme has allowed six out of 10 users to buy a bigger property than they would have otherwise been able to afford.

And more than eight out of 10 buyers would not have been able to buy the same property without assistance.

Justin Gaze, head of residential development land at Knight Frank, said: “No industry should be reliant on government assistance indefinitely, so the decision by ministers to restrict the scheme to first-time buyers with regional purchase price caps is a sensible one.

“However, the ‘deposit gap’ that the Help to Buy equity loan scheme was established to overcome is still very much a problem.

“UK house prices are 37% higher than when the scheme was introduced in 2013 and the mortgage market for those with only a 5% deposit remains very thin.

“For prospective buyers, finding the funds for a deposit will remain the biggest barrier to home ownership.

“From 2023, the onus will move to mortgage lenders and the development community to help buyers bridge this gap.”

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:
BUDGET 2018: Minimum Premium Bonds investment to fall from £100 to £25

NS&I will lower the minimum threshold to save into the hugely popular Premium Bonds from next year.

Close