The government has confirmed an extension to the Help to Buy equity loan scheme in England to ensure buyers do not miss out due to delays after the pandemic.
Last week (July 31) the government announced that the deadline for homes to be finished in order for buyers to benefit from the equity loan scheme had been extended by two months to February 28, 2021.
The scheme was originally due to come to a close for new buyers on December 31, 2020 but there were concerns buyers could “miss out” if they face a delay in construction due to the coronavirus.
Buyers will still need to legally complete their purchase by March 31, 2021 to qualify for an equity loan.
Additionally, the government announced that public body Homes England would work with buyers who had reserved a property before June 30 to assess their situation and, where necessary, look to provide an extension until May 31, 2021 to legally complete.
According to the government, some customers had experienced “severe delays” due to the virus crisis.
Christopher Pincher, minister for housing, said: “Today’s announcement will help provide certainty and assurance for Help to Buy customers whose new homes have been delayed due to coronavirus and affirms the government’s commitment to helping more people to own their own home”.
The current Help to Buy equity loan scheme in England is due to be replaced from April 2021, with a new scheme restricted to first-time buyers, under which regional property price caps will also apply.
The government confirmed the new scheme would run until March 2023 “as planned” with no plans for further extensions.
Under the current scheme, first-time buyers and homemovers can borrow up to 20 per cent of the cost of a new-build property from the government. In London, the maximum equity loan is 40 per cent.
The value of Help to Buy equity loans reached £16.05bn in England between its launch on April 1, 2013 and March 31, 2020, according to data from the Ministry of Housing, Communities and Local Government.