Thousands of buyers who used the Help to Buy equity loan scheme are facing a milestone anniversary which could prove costly.

The scheme, available only on new-build homes, is coming up to its five-year anniversary.

It means that for all those early users, the cost of their loan is imminently set to rise.

The scheme allows buyers to take out a five-year interest-free loan of up to 20% of the value of a property worth up to £600,000. It means that borrowers need only a 5% cash deposit, while taking out a 75% mortgage.

After five years, borrowers must pay 1.75% of the value of the Help to Buy loan, rising each year by retail price inflation plus 1%.

The alternative is to pay the loan off, but this is usually by remortgaging – which requires equity in the property.

Many Help to Buy customers will have relied on rising house prices in order to supply this equity and remortgage. But a number of new-build homes may not have appreciated much over the last five years, and some may have been over-priced in the first place.

At least one developer, Barratt, is trying to woo Help to Buy purchasers from five years ago into buying again on other developments through the same scheme.

Sales director Sara Parker said: “After five years, payments on the Help to Buy scheme start to incur interest but by moving home, and entering into a new Help to Buy arrangement, purchasers can have another five years interest free.”

The Resolution Foundation said the loans were a ‘ticking time-bomb’.

Critics have said that in reality, Help to Buy should be called Help to Sell, as the scheme has helped developers shift homes – and at a better price than they might otherwise have achieved.