Can extending Help to Buy boost the first time buyer market?
Estate Agent Today is reporting that the government is thinking of extending the controversial Help to Buy scheme beyond its end of 2020 deadline.
The reasons on the surface may seem quite logical. The Covid-19 lockdown has delayed the completion of nearly 20,000 Help to Buy purchases, and extending the scheme will certainly help the construction sector, in particular.
But is it a good idea?
Zah Azeem, Partner at Wimbledon-based surveyors Scrivener Tibbatts, thinks not: “It’s well known within the industry that a 20 per cent premium is invariably added to the price of Help to Buy properties because developers know it’s a closed market.”
This is also borne out of analysis reported here: last year a National Audit Office analysis revealed that 63 per cent of people buying a home under the scheme could have afforded to do so anyway; more households with incomes of £80,000 and above purchased using Help to Buy than households with less than £30,000.
So the government’s bright idea to help first time buyers get onto the housing ladder is flawed. It was a good idea on paper, that isn’t working in practice.
So often the devil is often in the detail. That’s not something BoJo’s administration fills one with confidence will be carefully examined any time soon.