The initiative was due to begin in January 2014 but chancellor George Osborne announced it had been brought forward as the Conservative Party held its annual conference in Manchester this week.
The Royal Bank of Scotland and Lloyds Banking Group have confirmed they will be taking part in the scheme and their opening hours will be extended to cope with potential high demand.
Mr Osborne acknowledged concerns that the scheme could create a housing bubble by asking the Bank of England to step up its reviews of the initiative.
He has called on the Bank’s Financial Policy Committee to assess the scheme every September, rather than at the end of its three-year lifespan.
The FPC will be allowed to question the £600,000 price cap for the scheme, as well as fees charged to lenders. It will also have the ultimate say in whether to continue with the scheme beyond the current term.
The chancellor announced the watching brief on the housing market to ensure it does not pose a risk to financial stability after the FPC held its latest policy meeting on 18 September.
A Treasury spokesman said the FPC’s assessment demonstrated a “broadening recovery” in the housing market but also a need to remain “vigilant”.
Industry views
David Brown, commercial director of nationwide firm LSL Property Services, warned that there needed to be a “touch less inflation and a real dollop of higher earnings” to create an increase of buyers.
Paul Smee, director general of the Council of Mortgage Lenders, said: “We now have an indication of how and when the Bank will determine whether the scheme needs to change during its three-year proposed lifespan, and this annual review will be a key deciding factor in that.”
Ian McGrail, managing director of Scotland-based FirstMortgage, said: “The introduction of Help to Buy in Scotland comes as a great relief to us. We will now be able to deal with the escalating demand from first-time buyers which has rapidly increased in recent months.”
Big Figure
Current price cap for the scheme: £600,000
Help to Buy in Scotland
Mr Osborne’s concession has not deterred the Scottish government from investing £220m in the Scottish version of the scheme which officially launched on 30 September.
The price cap for the Scottish scheme is set at £400,000, a lower level than in England.
The Welsh version of Help to Buy is due to launch later in the year.
