New data shows that more than 27,000 people across the country have bought a new home through the Help to Buy scheme.
New stats out today show how Help to Buy is opening up home ownership to thousands and supporting the government’s long term plan to help hardworking people secure a better future for their families.
In total 27,861 households have been helped by the scheme, which continues to overwhelmingly benefit first-time buyers, with the vast majority of sales outside of London and at prices well below the national average.
Help to Buy is also helping to increase housing supply, with the scheme driving demand for new-build homes. 74% of the homes bought through Help to Buy are new-build properties and we are seeing encouraging progress in the number of homes being built. Private house building is up 34% since the launch of Help to Buy and leading builders credit the scheme for reinvigorating the house building industry and boosting housing supply.
Find out more about the Help to Buy scheme and how you could benefit.
Today’s figures reveal that 85% of Help to Buy sales are to first-time buyers, showing how although Help to Buy accounts for only a small percentage of overall house sales (recent estimates suggest less than 3%), the scheme is continuing to successfully target the people who need a helping hand to get on the housing ladder.
Help to Buy is supporting responsible lending, with the average house price for the combined schemes at £191,295, or £151,597 for mortgage guarantee and £204,805 under the equity loan scheme – all of which are well below the UK average house price of £252,000.
The average house price to income multiple under the mortgage guarantee scheme is just over 3x salary.
Success across the country
The figures also show how Help to Buy is benefiting every region of the country, with the North West as the highest region for the Mortgage Guarantee, while the Equity Loan – the scheme for new-build properties– at its highest in the South East. Over 94% of completions under the scheme remain outside London.
Figures for the mortgage guarantee scheme also show completions have been least concentrated in regions where house price growth is highest, for instance in London the scheme makes up just 0.6% of all mortgage lending compared to an average of 1.3% across the country.
The Prime Minister said:
“As Britons, home ownership is in our blood – it’s about aspiration, planning for the future and laying down roots.
“But we inherited a situation where for many people, buying a home seemed all but impossible – people who worked hard, had good jobs and could afford the monthly mortgage payments, but didn’t have the large deposit needed up front. For those without rich parents, the dream of home ownership remained just that: a dream. That is why we brought in Help to Buy.
“Today, Help to Buy has helped thousands of hardworking people to buy a new home and crucially it is helping to increase the number of new homes being built around the country.
“It is an important part of our long term plan to back those who want to get on and to secure a better future for Britain.”
House builders have also welcomed the role Help to Buy has played in boosting supply. Home Builders Federation Executive Chairman Stewart Baseley said:
“After a number of years when house building levels fell to a record low level, all indicators show supply is now increasing rapidly.
“The Help to Buy Equity Loan scheme is supporting demand for new build homes – and if buyers can buy, builders can build. Its extension provides certainty about longer–term demand that will allow the industry to plan ahead, rebuild capacity lost in the downturn and ultimately deliver sustainable increases in supply.
“This is providing desperately needed homes and also creating tens of thousands of jobs on sites across the country and in the supply chain.”
The Prime Minister welcomed the news on a visit to a construction site in Ilkeston in Derby today, where Taylor Wimpey is building around 280 new homes, with many being bought through Help to Buy since it was introduced.
Pete Redfern, CEO of Taylor Wimpey said:
“Help to Buy Equity Loan has given more people the confidence and the ability to step onto or move up the housing ladder. It enables us to build more homes on the sites we have already got open, and has given us more confidence to invest in future sites and infrastructure which creates more jobs and economic activity locally.”
Markit have also noted the boost to house building since Help to Buy was introduced. Chris Williamson, Chief Economist, Markit:
“Since the Help to Buy scheme was announced, the construction PMI survey conducted by Markit on behalf of CIPS has shown the strongest period of continuous house building growth for 14 years.
“Confidence about the year ahead in the construction industry as a whole surged higher last summer, attributed by many companies to the various policy initiatives that have been put in place, including Help to Buy, Funding for Lending and the Bank of England’s ‘forward guidance’. The latest survey data shows confidence remaining close to record highs in April, suggesting the sector will continue to boom as we move through the summer.”