There is a ‘medium likelihood’ that the Chancellor will revive Help to Buy within her Budget today in order to stimulate a sector of the housing market where both demand and housebuilding have plummeted, according to a pre-budget report by Hamptons.

The estate agency believes, though, that it would be a new, less generous form – potentially as an extension of the existing Freedom to Buy mortgage guarantee scheme.

The Freedom to Buy currently provides support for lenders rather than buyers, but Hamptons says that by adding an equity loan component, it could provide a more meaningful demand-side stimulus.

Housebuilders will only build if there’s demand.”

According to the report: “Housebuilders will only build if there’s demand.  A reworked Help to Buy scheme could help bridge the affordability gap for first-time buyers, particularly in higher-cost regions, while also giving developers the confidence to increase output.”

The data shows that, between 2013 and 2023, the original Help to Buy Equity Loan supported 387,000 purchases – 85% of which were first-time buyers.  Despite its headline cost (£24.7bn in loans), the Government has already recouped a portion of this through repayments and rising house prices.

Around 48% of loans have now been repaid, the government has seen a £1.02bn uplift from price growth, and 206,000 homes still carry an equity loan, generating £129m in interest last year.

Divides opinions

While Hamptons admits that the scheme’s legacy divides opinion, it says it still offers valuable lessons. That’s because its generous criteria drove strong uptake, with one in three new homes sold using the scheme at its peak, and its Market impact was significant – boosting both first-time buyer numbers and new build completions.

The report adds that any new version is likely to be more targeted and less generous, potentially with tighter price caps, regional restrictions, a smaller equity loan component or income thresholds.

But it concludes that even a scaled-back scheme could help unlock stalled development sites and support younger buyers struggling with affordability in a high-interest-rate environment.