News Government rejects claim that Help to Buy scheme is driving up property prices
08-31-2018
Suggestion that flagship housing policy will be scrapped for failing first-time buyers are labelled 'pure speculation' House building in the UK
William Mclennan
News for open-minded people. The government has rejected claims that its flagship housing scheme is driving up house prices by helping affluent homeowners instead of first-time buyers. Ministers were reported to be pushing to end the Help to Buy scheme after figures showed that one in five households had used a government loan to “upsize” to larger homes, rather than to get onto the housing ladder.
A review of the policy, yet to be formally announced, is expected to lead to a narrower focus on firsttime buyers, the Sunday Telegraph reported. ‘Pure speculation’ A Ministry of Housing source yesterday told i that claims it could be scrapped were “pure speculation”. A row of houses (Getty Images) Under the scheme, introduced under David Cameron, the government lends up to 20 per cent of the cost of a home, leaving buyers to provide only 5 per cent. The loan is interest-free for the first five years. It is only available on new properties and is intended to drive house building. Help to Buy was guaranteed to continue until March 2021 and the Ministry of Housing said that it “recognises the need to create certainty for prospective homeowners and developers beyond this date”.
PlayUnmuteLoaded: 0%0:06Progress: 0%Remaining Time -1:13Fullscreen ‘Unlikely to effect house prices’ It said that only four per cent of overall housing sales involve a Help to Buy loan, adding: “The scheme is unlikely to have a significant effect on house prices.” David O’Leary, policy director of the Home Builders Federation, said: “As well as supporting hundreds of thousands of first-time buyers on to the housing ladder, Help to Buy has driven unprecedented growth in housing supply since 2013. Builders continue to invest in new land and labour to build more. “Without the scheme in some form, the Government’s ambition to deliver 300,000 new homes per year will be even tougher to achieve.”