The government will give in to pressure to further extend the Help to Buy scheme according to leading housebuilders, which has improved sales of new homes.
Introduced in 2013, the government handout allows buyers to apply for an interest-free loan of 20% of the full cost of a newly build house or flat in England for five years, covering homes worth up to £600,000, though rules do vary elsewhere in the UK.
Sales, profits, share prices and directors’ pay have been boosted for housebuilders as a result of this, but the scheme was due to be shut down in March 2021, leading to the larger housebuilders in the UK pushing for an extension.
According to the Sunday Times (2/9/18, page 2), insiders believe that housebuilders will get their wish, and that chancellor Philip Hammond will reveal an extension to the scheme in his autumn budget.
Over the past year, over 40% of sales of new-build homes have been attributed to private buyers as a result of Help to Buy, but the scheme has had some criticisms.
It’s believed that close to a fifth of people using the scheme aren’t the first-time buyers it is intended to help, but those who are looking to move to a larger property. As well as this, there’s no limit on the income of people that can bend the rules in their favour.