Housing Specification Blog

Budget 2013: How helpful is the new Help-to-Buy scheme?

March 21, 2013 Alexandra Blakeman Planning & Legislation

Yesterday’s budget delivered the expected incentives to boost UK housebuilding. According to the Chancellor, we need to help Britain become an ‘aspiration nation’. So how does his Help-to-Buy scheme size up for potential buyers?

The scheme consists of two initiatives:

  • The equity loan will offer homebuyers a 20% interest free loan for 5 years towards a new build home. Buyers are then required to put up a 5% deposit.
  • The mortgage guarantee will provoke lenders to offer better access to low deposit mortgages.

Research from Shelter estimates that the equity loan will bring the average local home within reach of the average two earner household in 46% of areas in the country.

The mortgage guarantee will be available from January 2014, and will run for three years. The incentive is available to first time buyers and existing home owners.

Wienerberger’s Commercial Director, Keith Barker, commented on Help-to-Buy:

“We welcome that the Government is looking to address some of the issues facing the housing market in yesterday’s budget. The Help to Buy initiative seems to be a positive step, and in particular the loan incentive additions to the ‘NewBuy’ scheme which, by encouraging first time buyers towards new build properties, will hopefully stimulate support and demand for the homebuilding that this country desperately needs.

“However, as a note of caution, we would suggest that equal attention, and indeed investment, should be focused upon growing the construction sector, which is vital to the UK economy as a whole. Over the last three years the government has launched at least five initiatives to revive the housing market, and yet housing starts fell 11% last year, so getting the initiatives to work is key.”

Let us know your thoughts. Do you think Help-to-Buy has the capacity to kick-start the industry?

 

 

Be Sociable, Share!

    budgethelp to buy


    Leave a Reply

    Your email address will not be published. Required fields are marked *