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4,000 sign for Help to Buy scheme 28 June 2013

The Home Builders Federation (HBF) has announced the Help to Buy equity loan scheme has begun successfully after launching on 1 April.

4,000 people have reserved a new home using the equity loan part of the scheme.

Stewart Baseley, executive chairman at the HBF, said: “The equity loan part of Help to Buy has got off to a flying start.

“It has been an unqualified success so far and 4,000 reservations in just two months show both the consumer demand for the scheme and developers’ commitment to it.”

Under Help to Buy, shared equity loans will be available to anyone with a 5% deposit for a home, not just first-time buyers, and will be equal to 20% of a property’s value.

The loan will be interest-free for five years and repaid when the property is sold.

Baseley says that the scheme will contribute by creating jobs and delivering an economic boost.

He explained: “The large deposits required in recent years to secure a mortgage have prevented many from buying – and as a result, builders from building.

“The equity loan scheme helps consumers overcome that deposit barrier and as a result the scheme will undoubtedly lead to an increase in house building – we are already seeing companies revise their projected build levels as a direct result of the scheme.”

The second part of Help To Buy is a new mortgage guarantee which will help mortgage lenders lend to buyers without a big deposit.

The £130bn guarantee package will begin at the start of 2014 for three years. The scheme will be available to all homeowners, including those moving up the housing ladder.

 

 

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