In excess of 4, 000 households enrolled in the Governmentís Help to Buy scheme to purchase their homes in June, the highest monthly total since records began in 2013.
Fresh data from the Department of Communities and Local Government showed that loans amounting to £1.1bn had been distributed to fund purchases costing £5.65bn. The data also indicated that there were over 4,300 house purchases during June, a figure which represents roughly a sixth of the 27,000 homes procured using the scheme thus far. The above figures pertain to one aspect of Help to Buy, whereby buyers can obtain a loan, with no interest, which will cover up to 20% of a new home.
However, more than two thirds of those involved in the Help to Buy scheme, took out the riskier 95% mortgages.
Devised in April 2013, Help to Buy was intended to indirectly catalyse the construction of new homes, through the provision of small deposits which made it easier for low-income buyers to get on the property ladder. Conservatives insist there flagship housing policy is yielding fruitful results.
Brandon Lewis, Housing Minister, offered: “It’s no accident that since the start of the scheme private housebuilding has shot up by a third and continues to climb. Developers are increasing their output, and taking on new workers at the fastest rate since records began.”
The greatest number of houses sold were valued in between £150,000 and £200,000, with a fifth priced in between £200,001 and £250,000. The average value of a sold property, under the Help to Buy scheme, was £187,000.
Quite significantly, over eight in ten houses were purchased by first-time buyers, with only 3% of the total number of those enrolled in the scheme receiving incomes of over £100, 000. Given that those with incomes of such size would generally break the £600, 000 threshold on their homes, and thus not be affected by the Help to Buy scheme, the data points to the aid Help to Buy provides for young people.
Mr. Lewisí remarks come a time where the opposition have piled pressure on government housing policy, with the shadow housing minister, Emma Reynolds, focussing on the Coalitionís lethargic rates of long-term house-building. This vaunting display from the Tories is further indicative of the warring stance the UKís two main parties could take up prior to the general election. However, it also shows the Coalition government are not prepared to lie down to what they perceive as slander.
On Thursday, the shadow housing minister accused the Tories of ìnot even building half the homes we need to keep up with demandî.
ìIf the Tory-led governmentís record is repeated until 2020Öthe gap between housing supply and demand under the Tories will have reached 1.3m homes,î she added.
Mr. Lewis, however, contested the Labour viewpoint on Coalition long term house-building prospects:
He said: “Today, for the first time, we’re publishing postcode level data about the scheme, so communities can see exactly how this vital part of our long-term economic plan is improving the housing market and helping their area.”
Mr. Lewis went on to lambast the Labour housing record, directing a well-aimed slur in the direction of Ms. Reynolds, referencing the average house price increasing by 214% during New Labourís regime.
Stewart Baseley, executive chairman of the Home Builders Federation, talked of the positive ramifications Help to Buy had had for the UK. “Indicators suggest increases in house building activity in the region of 25% and the past year has seen the steepest increase in new housing starts for around 40 years,” he said.
“The industry has recruited thousands of people in recent months and is working with its supply chain to ensure the capacity is there to sustain increases ñ all of which is giving the country a huge economic boost.”