The government is being urged to reintroduce its Help to Buy scheme, amid soaring rents, rising rates and the cost-of-living crisis.
Paul Sams, partner and head of property at Law firm Dutton Gregory wants to see the scheme reintroduced, and said without it, a “whole generation of young people” were being denied access to opportunities to get on the property ladder.
Many first-time buyers were having to put their dreams of owning a home on hold, which was increasing pressure on the rental market, according to Sams.
He said: “The Help to Buy scheme was extremely beneficial to first-time buyers, housebuilders, and the overall health of the property market.
“As it was self-funding, it should never have been scrapped. With interest rates now at their highest level for 15 years, it should be reintroduced as soon as possible.
“First-time buyers are finding it much harder now, so there is a danger of a generation of young people being denied accessible home buying opportunities. Meanwhile, the demand for rental properties far outweighs supply. Prior to a decade of Help to Buy, there was Home Buy Direct and First Buy, so how is it right that there is no longer a government initiative to make home ownership a possibility for those without a substantial deposit?”
Sams said housebuilders could also offer their own private alternatives, citing Fairview Homes’ Save to Buy scheme and Proportunity as an example. Similar initiatives have been offered by St Modwen Homes and Kettel Homes, among others.
Sams added the government’s current First Homes initiative allowed first-time buyers who met Local Authority criteria to secure a home for 30 to 50% less than market value but there were few of these homes available.
“As there is currently no sign of widespread first time buyer assistance on the horizon, the only way forward is for more housebuilders to introduce their own private schemes in order to convert those in the rental trap to new homeowners,” he said.
“With a general election on the horizon, I do believe the government will introduce a scheme similar to the previous Help to Buy within the next 12 months, but it’s needed now. Housing developers are lobbying for its resurrection, but will they step up with their own initiative in the meantime?”
Help to Buy launched in 2013 and the scheme closed to new applicants in England last year. The final deadline to complete a purchase passed earlier this year.
Some 383,903 properties were bought using the scheme between April 1 2013 and December 31 2022. It allowed first time buyers to borrow an equity loan to cover up to 20% of their property purchase price, or 40% for properties in London.
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