The Help to Buy scheme will be extended from its current deadline in 2021 to 2023, the Chancellor of the Exchequer has announced.
In his budget earlier today (29 October) Philip Hammond confirmed the Help to Buy Equity Loan scheme would continue until 2023, as mooted at the Conservative Party conference in September.
The Help to Buy scheme was launched in 2013 and is available for new build properties, offering a government loan of up to 20 per cent of the home’s value.
The scheme has been extended once before when in November 2015 the government announced an extension of the initiative up to its most recent deadline of 2021.
Earlier this month and in anticipation of the Budget the Intermediary Mortgage Lenders Association (IMLA) called on the government to clarify the future of the scheme to prevent a "destabilisation" of the housing market.
Speaking at the time, Kate Davies, executive director at IMLA, said: "Lenders and borrowers place heavy reliance on the scheme, and a major step-change to arrangements would risk significant market disruption and potentially undermine the government’s ambitious targets for new housing supply."
IMLA requested the government give lenders enough notice of any proposed changes to plan ahead.
The Association of Mortgage Intermediaries (AMI) also voiced its support of an extension to the scheme, warning mortgage approvals and purchases were likely to "stumble" if the government failed to do so.
The AMI predicted without the scheme new build loan-to-values were likely to fall back again and a drop in purchases and approvals would put more pressure on the remortgage market to support lending