Help to Buy: equity loan creates 46 new homeowners a day

Tuesday 28 Jan 2014 @ 16:15
Department for Levelling Up, Housing & Communities

Equity loan scheme has created 46 new homeowners every day since its launch, new figures show today (28 January 2014).

Housing Minister Kris Hopkins welcomed the news, as a sign of how the scheme is helping both aspiring homeowners, but also the wider construction industry as more homes are built in response to this growing demand.

Since the scheme’s launch just 9 months ago, there have been 12,875 sales of newly-built properties through the Help to Buy: equity loan, with a further 6,446 sales in the pipeline. The figures also show there are over 22,000 new homes reserved through the scheme.

Leeds leads the way

Aspiring homeowners have been helped across the country: Leeds has the highest number of sales with 230 through the scheme since April, while Wiltshire, Central Bedfordshire, Milton Keynes and Manchester complete the top 5 areas.

Across the 32 London boroughs there were 810 Help to Buy sales - 6% of overall sales in the capital.

And around 90% of sales of newly-built homes through Help to Buy were to first-time buyers.

Getting Britain building

But Mr Hopkins also welcomed the wider impact on the construction industry that the Help to Buy scheme is having, with leading developers pledging to build more as a direct result of it. On top of this over 1,200 housebuilders have registered to participate in the scheme – 94% of which are small and medium-sized businesses.

And just last week the minister visited the Hanson’s Claughton Manor brickworks in Lancaster, a site that had been mothballed in 2009 but has now reopened in response to a surge in demand for bricks, thanks in part to Help to Buy.

The Help to Buy: equity loan scheme enables people to buy a newly-built home with a deposit of at least 5% of the property price, while the government offers a loan of up to 20%. The rest is covered by a mortgage.

This scheme also complements the Help to Buy: mortgage guarantee, which has helped open up the mortgage market and enables people to buy with a mortgage of up to 95% of the property’s value, by offering a guarantee on part of the loan to the lender. Since its launch in November, more than 6,000 aspiring homeowners have put offers on homes through the mortgage guarantee.

Kris Hopkins said:

I’m delighted that through the Help to Buy scheme, we’ve helped thousands of hard-working people realise their dream of becoming homeowners, getting onto the property ladder using this valuable alternative to the Bank of Mum and Dad.

But the Help to Buy scheme offers more than that: because each home sold is a new-build, we’re also getting Britain building, with workers returning to sites across the country and helping bring housebuilding to its highest levels since 2007.