The latest scheme announced by government that is expected to boost the housing market, push up mortgage demand and assist growth in the construction industry is called Help to Buy.  It will aid borrowers in search of a low deposit loan by allowing them to supply 5% of the deposit toward the property which must be a newly constructed property.

The announcement immediately supported shares in housebuilders as investors viewed the scheme as a move toward more demand for new housing.

The scheme will begin on April 1 and will supply a 20% interest free loan with a 5% deposit required from the buyer.  This will no doubt be attractive to first time buyers.  The scheme will remain available for three years but demand is expected to strip the set aside amount by government of £3.5 billion.

Ed Balls, shadow chancellor, stated, “There has been a big hit to housebuilding, including affordable housebuilding, over the last couple of years because of the scale of the cut in the government's investment going into affordable housing. We have seen an 11% fall in housing starts. It is not only about public spending. More broadly, the state of the economy means that private developers are not building affordable homes.

"We are pleased they have done something around housing and housing starts. But it is tiny numbers compared to the scale of the challenge in terms of getting housebuilding moving."

Many others within the housing market came out to announce support of the scheme.  Just as the Lending for Funding scheme had both its share of supporters and critics, in time the effort will either work for one side or the other.  Most agree that something is needed to build demand from first time buyers and bring the housing market back to a healthier level.