The market freeze caused by social distancing measures is prompting many to claim that Help to Buy deadlines should be pushed back in order to facilitate many delayed transactions.
Help to Buy is scheduled to change next year and will only be available to first-time buyers. However, the Intermediary Mortgage Lenders Association (IMLA) are concerned that current homeowners, looking to purchase a Help to Buy property, may not be able to do so before the 2021 deadline unless it is moved to recognise the time already lost.
RICS has already suggested that a Stamp Duty Land Tax reprieve may be a vital way of ensuring the property market continues moving post-lockdown.
As the economy shrinks, extending the current Help to Buy scheme could ensure more people are inclined to purchase property next year.
Kate Davies, executive director of IMLA, commented:
“IMLA has always believed it vital that the housing sector avoids a ‘cliff edge’ scenario with the end of Help to Buy and we welcome the news that the government may be considering an extension of the current scheme.
“Where the industry thought it had a year to prepare for the shift towards Help to Buy 2021, the impact of COVID-19 effectively closing the purchase market means a review of that timeline is almost certainly necessary.
“Many borrowers who might reasonably have expected to be able to complete their purchase before the end of 2020 may now find that very challenging. Any flexibility which will allow purchases to complete beyond the originally fixed deadlines will be welcomed.
“Going forward, it may be that some changes could sensibly be made to the scheme, while allowing it to remain in place for longer. Such changes could, for example, relate to the types of properties being built and could address some of the criticism which Help to Buy has attracted in the past.”
