Fresh figures from HMRC reveal that 41,052 mortgages have been completed through the government’s mortgage guarantee scheme since its introduction in April 2021 up until September 2023, accounting for 1.6% of the total market.

There have been 1,864 more completions since the last dataset was released in June, the data shows.

The government has provided £1.1bn to support mortgage loans worth £7.8bn, and these mortgages were used against properties worth £8.3bn in total.

First-time buyers accounted for 86% of borrowers through the scheme, while the average household income of people using the initiative is £54,816.

Most people using the mortgage guarantee scheme have a household income of up to £50,000 and represent 51%of completions. Just 13% of people using the scheme have a household income of more than £80,000.

In terms of housing type, terraced houses made up the largest share of the type of home purchased or remortgaged using the scheme at 35%, followed by semi-detached homes (30%). Flats and maisonettes were the third-most-popular property type, making up almost a quarter – 23% – of the scheme’s completions.

The average value of properties purchased or remortgaged through the scheme came to £201,313.

The government recently extended the scheme until June 2025, but more needs to be done to support prospective homeowners, according to Karen Noye, mortgage commentator at Quilter.

She said: “Despite its low take up, for those that have used it, it has been a lifeline. However, when we dive into the numbers, the average property purchased through the scheme is valued at £201,313, noticeably below the UK average house price of £291,000. This clearly shows the scheme’s focus on the more affordable segment of the housing market, with three-quarters of the properties bought valued at £250,000 or less.

“The scheme primarily attracts individuals and families with household incomes of £50,000 or less, underlining its appeal to those aiming to step onto the property ladder without hefty financial backing. But, there’s a significant hurdle: the borrowing limit, typically capped at 4.5 times one’s annual income. For many earning an average salary, this means they can borrow just a bit over £150,000, significantly limiting their choices in a tight housing market.

“The government’s decision at the Autumn Statement to extend the scheme until June 2025 provides ongoing support but doesn’t necessarily change the game for prospective homeowners. It’s a helpful measure, yet it stops short of addressing the broader issues of affordability and access in the housing market. The concern over negative equity, especially for purchases at peak prices, adds another layer of caution for participants. Therefore, rumours of the government introducing 99% mortgages during the budget seem unlikely in this unpredictable housing market. However, house prices according to most indices have been climbing so the government may feel vindicated to bring this type of mortgage back.

“Regionally, the scheme’s uptake varies, with Scotland showing a particularly high level of engagement. This highlights how the scheme’s impact is not uniform across the UK, reflecting regional differences in housing markets and needs.”