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TODAY'S OTHER NEWS

Here we go again - Help To Buy looks likely to be extended

Government leaks to mainstream and building trade media suggest the controversial Help To Buy scheme will be extended beyond its end-of-2020 deadline.

An announcement is expected shortly.

Some suggestions say the extension could be just three months, to allow the clearance of as many as 18,000 H2B purchases delayed by Coronavirus, while other suggestions put the extension as considerably longer because of wider concerns about the economy and unemployment in the construction sector.

Either size extension would probably be controversial.

On the one hand, some agents and almost all housebuilders see the scheme as a means of improving their sales figures, especially to younger or first time buyers. Between its introduction in early 2013 and March this year - before the housing market was frozen - some 272,000 purchases had taken place via Help To Buy.

On the other hand, a slew of reports and analyses suggest that H2B does little to improve the quantity of housing stock and possibly increases prices - ironically making homes less affordable rather than more. 

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 for £80,000 and above purchased via H2B than households with less than £30,000.

Bruce Burkitt, founder of the Property Experts consultancy, wrote last year in Estate Agent Today: “Developers are aware that Help to Buy is a closed market, and many properties are sold for premiums of 15 to 20 per cent, a surprising statistic that may come to harm first time buyers perhaps more than it is helping them.”

Recent figures suggest that the average price paid for a H2B property across the UK is some £307,000.

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    Why not switch it instead to the secondhand market to specifically help first time buyers, the drivers of the housing market?

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    It was tried on 2nd hand and did not work.
    There is a huge amount of paperwork involved and many brokers especially those who are frantically busy do not want to get involved or to take on additional staff to deal with it.
    Same applies to some lawyers I have come across.
    Also it takes a long time to get processed.
    If I was acting for a vendor and had a buyer who wants to use H2B my advise to them would be to keep the property on the market and look for a buyer who did not need to use H2B.

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