FTBs responsible for 81% of Help to Buy equity loans

Over the period since the launch of the Help to Buy: Equity Loan scheme (1 April 2013 to 30 September 2017), 144,826 properties were bought with an equity loan, the Department for Communities and Local Government has revealed.

The total value of these equity loans was £7.39 billion, with the value of the properties sold under the scheme totalling £35.31 billion.

First time buyers accounted for 116,898 (81%) of total purchases.

The mean purchase price of a property bought under the scheme was £243,818, compared with a mean equity loan of £51,040.

In London, the maximum equity loan was increased from 20% to 40% from February 2016, and since then to September 2017, there were 5,715 completions in London, of which 4,517 were made with an equity loan higher than 20%.

For the Help to Buy: NewBuy scheme, 5,694 house purchases were made since the launch of the scheme in March 2012. There were no new transactions in Q3 2017 due to the scheme closing to new mortgage offers on 8 March 2015.

Craig Hall, new build manager at Legal & General Mortgage Club, said: “Help to Buy scheme is clearly playing a crucial role in reaching the people that need it most, particularly first-time buyers looking to make their first steps.

“Not only does the scheme help potential buyers, it also benefits housebuilders by supporting the high demand. However, even though we saw a number of supply led initiatives in the Autumn Budget to help get more people onto the property ladder, the future of the scheme remains uncertain. Without clarity about the future of the scheme beyond 2021, there could be implications for long-term planning for developers and lenders alike.”

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