The Home Builders Federation has come out swinging for Help to buy in a report titled “Bringing home ownership back into reach,” in which it claims that Help to buy has been “an unmitigated success.”
This comes soon after rumours about the future of the scheme began to circulate.
The report reiterates much of the data that the government released in Mid-August, including the fact that it has supplied nearly 170,000 borrowers with homes, most of whom were first-time buyers.
The HBF also estimates that the 48,000 homes sold through HTB in 2017 sustained 150,000 jobs and generated £1bn in tax receipts, with £73m of this going towards education through Section 106 taxes.
Two of the biggest criticisms of HTB is that it is being misused: figures show that some high earners are using the scheme to fund house purchase and a number of households are using it to a move to a more expensive dwelling, and that it has increased the prices of new build property.
The report states that the median income of a household using HTB in 2017 was £49,000 (with the median income for any other type of mortgage being £47,000), and in London, £61,400 for first-time buyers. For non-first-time buyers, this stands at £69,500, “well below the eligibility thresholds for affordable housing schemes in London,” says HBF, which are currently set at £18,100 – £66,000 for new homes, and up to £80,000 for family homes.
Concerning rising house prices, the report argues that a premium of 25 per cent on a new build home versus a second-hand property is “nothing new,” and that between September 2007 and September 2017, new build prices grew by 26 per cent versus 23 per cent for second-hand houses. Since 2013, when HTB was first brought in, the HBF says that these figures stand at 38 per cent and 35 per cent, respectively.
HBF executive chairman Stewart Baseley says: “It is quite clear that the Help to buy scheme has been an unmitigated success and has delivered handsomely on all its objectives. It has enabled hundreds of thousands of people to realise their dream of owning a home, the vast majority of whom are first time buyers on average incomes. It has led to an unprecedented increase in house building activity, created tens of thousands of jobs and boosted local economies the length and breadth of the country.
“Government should celebrate its success and use the hard evidence now available to rebut the claims of its critics. As we look to tackle our acute housing crisis and deliver on the prime minister’s target to build 300,000 homes per year the scheme has a key part to play. Government should reflect on the huge impact the scheme is having on individuals keen to realise their dreams of home ownership, on housing supply and on the wider economy.
“Housebuilders continue to invest in the land, materials and people needed to deliver furthers increases in supply confident in the demand Help to buy is underpinning. Certainty moving forward is now required to enable the increases in housing supply, and the associated social and economic benefits, to continue.”
Daniella Ward, Senior Sales Manager at Lanes New Homes comments ‘since the introduction of Help to Buy we have seen a year on year increase in an uptake of buyers using this scheme. It’s been a resounding success and has no doubt made buying your own home a reality for many first time buyers’