The Help to Buy mortgage guarantee scheme has saved homebuyers an average of £58,000 on a deposit, according to the Mortgage Advice Bureau.
The 600-adviser strong independent mortgage network said the typical Help to Buy (HTB2) deposit in September 2014 was £8,974, a drop of 3 per cent on August’s average of £9,229.
Compared to an average price of £226,641, HTB2 applicants paid £150,488 in September, the lowest price recorded in four months and a 6 per cent fall since August when the average price paid was £159,527.
The average loan to value (LTV) mortgage taken out by a HTB2 applicant was 94 per cent, compared to a marekt average of 70 per cent.
Applicants had an average primary income of £31,270 in September, or £2,018 in take home pay. If applicants saved 25 per cent of this every month it would take 1.4 years to save the average HTB2 deposit that month.
Brian Murphy, head of lending at Mortgage Advice Bureau, said: “The generosity of the 95 per cent loan-to-value associated with the scheme is clearly not being abused, lower earners are using the scheme to purchase lower-priced properties and are taking on much smaller levels of debt.”
Adviser view:
Tony Larkins, managing director of Beacon Wealth Management in Kimbolton said: “Three per cent is not that much. Obviously you would have to look at where they get their data but with house prices falling this is not too significant.”
