The extent to which the new-build homes market has become increasingly dependent on the government’s to Buy Equity scheme have been revealed by the Ministry of Housing, Communities and Local Government (MHCLG).
Last year 42,748 first time buyers bought a new-build property via the scheme, an increase of 14% on 2017 and an 85% increase on 2014, the first full year of its operation.
The scheme now represents approximately 5% of all types of home sold in England, and nearly a third of all new-build home purchases.
MHCLG’s figures also reveal that 211,000 properties have been bought via the scheme since it began in 2013 with a total value of £54.48 billion, and that the mean purchase price of a property was £258,223.
Also, the image of cash-strapped young first time buyers using the scheme to buy apartments is undermined by the survey, which reveals that the most popular kind of home is a semi-detached house.
Help to Buy equity loans are only available on new build properties and the maximum purchase price is £600,000. The loans are paid direct to house builders registered to take part in the scheme, which was recently topped up with an extra £10 billion in funding.
Not everyone is wild about Help to Buy. Buying agent Henry Pryor (pictured, left) says: “It’s a policy that has been allowed to go on far too long and although I’m aware that there are many within the new homes industry who disagree with me on this, I’m utterly convinced it has corrupted the market.”
Read more about Help to Buy.