Figures in the property industry have sharply criticised the announcement made at the Conservative party conference to pump an estimated £10 billion extra into Help To Buy.
As with existing HTB funding, the money will allow recipients to get a mortgage with a deposit of just five per cent - an estimated extra 135,000 buyers will be able to purchase new-build homes.
"Young people are worried that life will be harder for them than it was for their parents - owning a home is a key part of that. This government understands that for many people finding a deposit is still a very big hurdle” says Chancellor Philip Hammond.
Brighton estate agency chief Paul Bonett said on Twitter: “Help To Buy winners are property developers. Prices kept artificially high. First Time Buyers don’t ever own whole property. FTBs subsidising developers.”
Housing commentator and buying agent Henry Pryor also took to Twitter to declare “Oh God, no” when news of the announcement first leaked; former Tory MP Steve Norris - now chair of BNP Paribas Real Estate, which owns Strutt & Parker - tweeted: “Help2buy increases demand while supply is static. Prices rise and developers gain. If true this is a monumental mistake. Help2buy should go.”
Neal Hudson - former Savills researcher and now an independent housing analyst - said on social media: “£10 billion more to help another 58,000 who can’t buy and 77,000 who can but want something bigger than they can currently afford.”
Polly Neate, chief executive of housing charity Shelter, criticised the move saying Help to Buy had increased house prices and "propped up a speculative development model in need of reform".
And the Adam Smith Institute, a right-wing think tank, likened the revival of Help to Buy to "throwing petrol on to a bonfire”: a spokesman said that with supply so tightly constrained by planning rules “adding more demand without improving the supply of houses is just going to raise house prices and make homes more unaffordable for people who don't qualify for the Help to Buy subsidy.”
Help To Buy is currently scheduled to end in 2021 although house builders are reported to have lobbied the government to extend the scheme.