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The Impact of Help to Buy Across England Revealed

 

Help to Buy was introduced to rejuvenate the housing market but according to a property expert, the scheme has not been as successful in London as in other parts of the UK.

The Government confirmed it has assisted people to buy over 100,000 homes across the country. The data unit for BBC England analysed figures from Department for Communities and Local Government and found that Help to Buy Loans were used to buy nearly 77,000 homes outside of London during the three-year period between April 2013 and 2016.

This translates to 30% of the 356,000 privately build homes built during that period. The take-up rate in London has been a lot less than the rest of England.

In London, nearly 4,500 homes were completed using equity loans, which is the equivalent of 11% of the privately built homes erected during that time.

Fewer than one in every 500 homes has a Help to Buy loan in London, compared to one in 200 in the rest of England.

There was an increase of loans taken out in London since February, when the UK government increased the upper limit for London homebuyers to 40% of the property’s value.

Only 10 equity loans had been applied for in Hammersmith and Fulham, since they were introduced in 2013. Six of those 10 buyers were assisted between June and September 2016, which suggests that the upper limit increase made a difference.

Specialists in Construction Insurance

In Kensington and Chelsea, the most expensive property zone, the only two loans taken were worth £360,000 in total.

The highest number of loans taken out was in Bedford, with two in every 100 households using Help to Buy. In England overall, the average loan value was £46,300.

Henry Pryor, housing market commentator and property agent, warned that there could be problems once the Help to Buy subsidies disappear.

Mr Pryor said that the initiatives have been more beneficial outside of the South East, where prices tend to be lower. There appears to be less opportunity in London, which is partially why the local numbers are so minimal. Even London’s own version has met with little success.

He said that the schemes had clearly been beneficial from a political and practical perspective, but added that the question was whether the UK Government can ease developers and lenders off the ”financial drug” it was addicted to.

Watching commercial house builders and developers profit from taxpayer subsidies was not something that could last indefinitely, he said.

Shelter director of communications, policy, and campaigns Roger Harding said that while Help to Buy might help some new buyers onto the housing ladder, in the short term house prices will go up, making it more difficult for others to buy a home in the future.

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