The programme set in place by the government to help bring back first time buyers and assist the construction sector has helped more than 17,000 households buy homes.  The Help to Buy scheme data complete for the first nine months of the scheme revealed that 88% of the total 17,395 buyers were first time buyers which was badly needed to help thaw the property ladder.  A lack of first time buyers had led to a slow down of homeowners being able to sell their starter homes and move home to a larger property.  In addition, those hoping to downsize found few buyers looking to upgrade.  Without first time buyers there was little movement on the property ladder and home movers slowed down.

The average value of a property bought through the Help to Buy scheme averaged £194,992.

The scheme allowed home buyers to obtain mortgages at 75% of a property’s value and secure an equity loan for up to 20% from the government allowing a deposit of only 5%.  This part of the scheme launched in April in England, September in Scotland and began at the beginning of this year in Wales.  Homes purchased through this part of the Help to Buy scheme are limited to new builds.

The second part of the scheme is the mortgage guarantee which began in the UK last October and has been extended to 2016.  The government offers a guarantee against losses for lenders when offering small deposit mortgage deals. 

The rising demand for property has started to push house prices upward and that is causing some to worry that it is happening too fast.  The upward movement of house prices is helping to boost equity in homeowners’ properties but if prices become out of reach then first time buyers may retreat.