Less than three months on from the start of the Help to Buy mortgage guarantee scheme, over 6,000 people have put in offers on a home and applied for a mortgage, UK Prime Minister David Cameron announced today (Thursday 02 January).
It means that in just 12 weeks, nearly 750 home owners in the UK have completed their purchases and hundreds were able to spend Christmas in their new homes, he added.
In November, ministers published figures showing that in the first month of the scheme more than 2,000 people had put in offers on homes and applied for a Help to Buy mortgage. That number has now trebled to more than 6,000.
The mortgages, once approved, would represent nearly £1 billion of new lending to aspiring home owners who may have previously found the property market out of reach because of the size of deposit required.
As part of the long term economic plan to build a stronger, more competitive economy to secure a better future for Britain, the government is committed to increasing the supply of housing and supporting those who aspire to own their own home.
New figures also show that an additional 20,000 households have also been supported by the Help to Buy Equity Loan scheme, a separate scheme where the government provides an interest free loan to support the purchase of the newly built home.
The government says that house building is now growing at its fastest rate since 2008, and it pledged that house building will remain a critical part of the country’s economic recovery.
The figures show that on average households are looking to buy homes worth £160,000 which remains below the UK average house price of £247,000 and applicants will face average monthly repayments of around £900 and have an annual household income of around £45,000. This means a Help to Buy mortgage represents 23% of borrowers’ gross income.
Help to Buy mortgage applications are still coming in from across the country, and around three quarters are from outside London and the South East, and over 80% from first time buyers.
The large number of applications for Help to Buy mortgages suggests the high Loan To Value part of the mortgage market is once again moving. High Loan To Value mortgages have been the main route to ownership for most first time buyers over the last 30 years, but there have been fewer products available in recent years.
‘The New Year is often a time when people look to make those big life changing decisions like moving home or taking that first step on the housing ladder. But too many people have found themselves frozen out of the market in recent years as a result of the size of the deposit required,’ said Cameron.
‘That is why as part of our long-term economic plan we introduced the Help to Buy scheme, so hardworking people with sufficient earnings can get on, fulfil their aspirations and enjoy the security of owning their own...