First-time buyers accounted for 81% of the total home purchases through the Help to Buy: Equity Loan scheme in the period between it’s launch in April 2013 and ending September 2019, according to new Government figures.
The Ministry of Housing, Communities and Local Government revealed that during this period, 248,075 properties were bought with an equity loan, with 201,784 of those made by first-time buyers.
The latest data revealed the total value of the equity loans during this period reached £14.31bn – with the value of the properties sold under the scheme totalling £65.69bn.
The Government figures also showed the mean purchase price of a property bought under the scheme was £264,785, with buyers using a mean equity loan of £57,694.
In London, the maximum equity loan was increased from 20% to 40% in February 2016, and the Government data showed that since then to September 2019, there were 17,287 completions in London – of which 15,085 were made with an equity loan higher than 20%.
“Buyers should understand exactly what’s involved before considering the loan scheme,” commented Hargreaves Lansdown personal finance analyst, Sarah Coles. “You have to buy a new-build, which comes with a major premium.
“You may also be persuaded to stretch yourself further to buy a bigger and more expensive home – the average first-time buyer property bought through the scheme costs more than the average UK property and a quarter of first-time buyers using the scheme end up buying a detached house. Then, after five years, you need to remortgage or pay fees on the Government portion of the loan.
“One in 20 people have fallen into arrears in the scheme, and even those who keep up repayments can run into trouble when they try to remortgage, if the value of the property has fallen.”
The Government has confirmed the current Help to Buy: Equity Loan scheme is ending in March 2021 to be replaced by a new scheme running from April 2021 until March 2023 – however, this will only be open to first-time buyers, and will include regional property price caps.
Latest News
-
House price growth rises to 2.4% in October – Nationwide
-
Mortgage affordability failing to reflect modern careers
-
Net mortgage approvals rebound in September – BoE
-
Adviser study reveals clients cutting pension payments for IHT purposes
-
One in five potential homebuyers unaware of available support
-
LendInvest completes £310.6m securitisation
NEW BUILD IN FOCUS - NEW EPISODE OF THE MORTGAGE INSIDER PODCAST, OUT NOW
Figures from the National House-Building Council saw Q1 2025 register a 36% increase in new homes built across the UK compared with the same period last year, representing a striking development for the first-time buyer market. But with the higher cost of building, ongoing planning challenges and new and changing regulations, how sustainable is this growth? And what does it mean for brokers?
The role of the bridging market and technology usage in the industry
Content editor, Dan McGrath, sat down with chief operating officer at Black & White Bridging, Damien Druce, and head of development finance at Empire Global Finance, Pete Williams, to explore the role of the bridging sector, the role of AI across the industry and how the property market has fared in the Labour Government’s first year in office.
Does the North-South divide still exist in the UK housing market?
What do the most expensive parts of the country reveal about shifting demand? And why is the Manchester housing market now outperforming many southern counterparts?
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance, to explore how regional trends are redefining the UK housing, mortgage and buy-to-let markets.
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance, to explore how regional trends are redefining the UK housing, mortgage and buy-to-let markets.
The new episode of The Mortgage Insider podcast, out now
Regional housing markets now matter more than ever. While London and the Southeast still tend to dominate the headlines from a house price and affordability perspective, much of the growth in rental yields and buyer demand is coming from other parts of the UK.
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance.
In this episode of the Barclays Mortgage Insider Podcast, host Phil Spencer is joined by Lucian Cook, Head of Research at Savills, and Ross Jones, founder of Home Financial and Evolve Commercial Finance.
© 2019 Perspective Publishing Privacy & Cookies
Recent Stories