The government and the opposition should look to reintroduce Help to Buy in a bid to win votes ahead of the 2024 General Election, one law firm has stressed.
Currently, conveyancers across the UK are working towards the 29th September final date for Help to Buy Agents to handover all paperwork connected with the scheme to Homes England.
With housebuilding currently high on the political agenda, national law firm Dutton Gregory has urged both major political parties to support the resurrection of Help to Buy during the autumn party conferences.
The continued cost of living crisis, significant planning delays, and the slowdown in the property market will result in the current government missing its own housebuilding target by a significant margin, the firm said.
Indeed, many would-be first time buyers are having to put their dreams of home ownership on hold, creating further demand for rented homes, where it is not uncommon for over 20 applicants per available property.
Dutton Gregory Solicitors is therefore calling for the reintroduction of the government’s Help to Buy initiative to “stimulate the first rung of the market”.
“The Help to Buy scheme was extremely beneficial to first time buyers, housebuilders, and the overall health of the property market,” said Paul Sams, Partner, and Head of Property at Dutton Gregory:
“As it was self-funding, it should never have been scrapped. The 29th September final handover deadline for Help to Buy Agents will conclude the decade-long initiative, which has had a widespread impact on the economy and the opportunities available to all those wishing to get on the property ladder…
…At present, there is a real danger of a generation of young people being denied accessible home buying opportunities. Meanwhile, the demand for rental properties far outweighs supply. Prior to a decade of Help to Buy, there was Home Buy Direct and First Buy, so how is it right that there is no longer a government initiative to make home ownership a possibility for those without a substantial deposit?
The government’s First Homes initiative enables first time buyers that meet Local Authority criteria to secure a home for 30% – 50% less than its market value, but there are so few of these homes available. Unless there is a new prospect of a widespread first time buyer assistance on the horizon, the only way forward is for more housebuilders to introduce their own private schemes in order to convert those in the rental trap to new homeowners.”
The firm suggested government key worker loans could work in a similar way and demonstrate meaningful support to public sector workers. Housebuilders could also offer their own private alternatives, such as Proportunity, Fairview Homes’ Save to Buy scheme, and similar initiatives by St. Modwen Homes and Kettel Homes. Prior to the introduction of Help to Buy in 2013, Barratt, Bovis Homes and many others also had their own versions, open to help first time buyers with low deposits to purchase a new home.
“I do hope both the Conservatives and Labour will table a scheme similar to the previous Help to Buy within the next 12 months, but it is needed now,” added Sams:
“Housing developers have been lobbying for its resurrection – should they step up with their own initiative in the meantime when housing is such a national issue? Should it be for the developers to decide this, or the political leaders of this country.”
Help to Buy closed to new applicants in England last year, with the final deadline to complete a purchase having now passed.
The most recent iteration of Help to Buy enabled first time buyers to borrow an equity loan to cover up to 20% (or in London 40%) of their property purchase price.
The latest government statistics showed that 383,903 properties were bought using the scheme between 1st April 2013 and 31st December 2022. While there is a mortgage guarantee scheme and opportunity for a Lifetime ISA, there is currently no scheme backed by the government which offers the same level of accessibility and inclusivity of Help to Buy.
One Response
Nonsense, HTB overinflated house prices, made a lot of money for new build law firms and developers. The quality of construction has not gone up. The quality of new estates has not gone up. Land hoarding is still going on. Houses are not affordable and are so out of reach of first time buyers. HTB did not do anything to solve long term housing issues in this country.