Pandemic pushes down Help to Buy sales

The latest data on Help to Buy home sales shows the scheme is still mainly being used by first-time buyers but many are on high incomes above the average for a UK household.

The Government figures show 11% of first-time buyers who used the scheme during the first quarter of 2020 earned more than £80,000 and the average applicant income is now £59,778 – up from £57,563 at the end of 2019.

Some may question why those on incomes way above the average UK salary of £36,611 per year or typical household income of £30,800, should still get state support for a 5% deposit under the Help to Buy Equity Loan Scheme.

The statistics show the coronavirus pandemic hit Help to Buy sales in the first quarter of 2020, falling 9% annually to 9,515.

This is the lowest level since the third quarter of 2016 when there were 8,542 sales.

Completions in March 2020 alone were down by 17% annually, the Ministry of Housing said.

Commenting on the figures,  Andy Sommerville, director of Search Acumen, said: “The latest Help to Buy data reveals the severe impact the early stages of the coronavirus pandemic had on a key driver of activity in the UK’s property market.

“The UK’s lockdown and tight safety measures caused an enforced sharp drop in demand for new properties eligible under the Help to Buy scheme.

“However, as restrictions start to loosen and Government incentives such as raising the Stamp Duty threshold come into play, we are starting to see early signs of an uplift.

“First time buyers are more likely to have been hardest hit by the pandemic, meaning they should be prioritised. Ensuring they are given adequate support will be key to speeding up the property market’s recovery.”

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One Comment

  1. Rhino

    I think you’ve got your figures wrong. As long a they have 5% the loan is up to 20%. But more importantly the current Help to Buy is totally in favour of the new build market and this does nothing to stimulate the general housing market because that’s the end of the ‘chain’. Instead of tinkering around with SDLT for a few months as an un-needed gimmick which is actually going to cost the Government money through lost taxation they would have been better served extending the scheme into the second hand market for a year or two in an attempt to keep the market moving across the whole housing spectrum and it would also have given buyers a choice apart from new homes – probably not very popular with house builders though!
    Just a thought – and they would earn Stamp Duty revenue

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