Prime Minister Rishi Sunak is thinking of bringing back the Help to Buy scheme – prompting a mixed response.
The scheme was launched in 2013 by George Osborne as a way of encouraging high loan-to-value lending, as the UK looked to recover from the global financial crisis.
It achieved this aim, as lenders signed up to the scheme offered mortgages with a 5% deposit. Help to Buy worked by including a 20% portion that was interest free for five years, or 40% in London.
The downside is the scheme has been blamed on stoking house price rises.
Paul Cheshire, a former planning adviser to the government and emeritus professor at the London School of Economics and Political Science, said: “It’s an insane idea which is very damaging to young people because it will land them with houses that they will find they can’t afford.”
Some 350,000 people benefitted from the Help to Buy scheme to buy their first home, though it’s thought it allowed developers to charge ever high prices for new builds.
David Smith, head of property litigation at JMW Solicitors, said: “Help to Buy has not been an unqualified success, helping some on to the housing ladder but leaving many more out in the cold.”
The Help to Buy scheme only ended last month, and it’s yet to be seen whether the government pushes forward with a relaunch, considering the mixed reaction.
