What is Help to Buy?
In the 2013 Budget the Government announced its two-pronged Help to Buy scheme – this aims to address the lack of mortgage finance in the market and increase supply by increasing effective demand.
The first part of Help to Buy – Equity Loan – has been hugely successful in boosting output. Since its launch in April 2013, the scheme has been responsible for delivering around 2500 reservations a month. This increase in demand is allowing builders to increase output, building the homes the country needs and creating jobs on sites and in the supply chain.
The second part of Help to Buy – Mortgage Guarantee – was due to be introduced to the market in January 2014, however, the Treasury brought the scheme forward so it will be available from 10th October 2013. Currently, Aldermore, Bank of Scotland, Barclays, Halifax, HSBC, Lloyds, NatWest, RBS, Santander and Virgin Money offer mortgages through the scheme.
Phase 2 of Help to Buy is applicable to both new builds and second hand homes. The scheme assists credit-worthy purchasers and has helped to boost sales across the market, and as a part of that new build should benefit.
On the launch of the scheme the Prime minister said:
“Too many hardworking people are finding it impossible to buy their own home – people who can afford the monthly mortgage payments but haven’t got rich parents and can’t pay the deposit up front.”
“There is a need for Government to act. Buying your first home is about far more than four walls to sleep at night. It’s somewhere to put down roots and raise a family. It’s an investment for the future. Above all, it’s a sign that everything you’ve put in has been worth it.”