The majority of people who benefitted from the government’s Help to Buy equity loan scheme were first time buyers, figures released today (16 August) have shown.
In the Ministry of Housing, Communities and Local Government’s latest statistical release, 169,102 properties were reported to have been purchased using the Help to Buy equity loan scheme since its launch in 2013.
The value of the equity loans totalled £8.93bn with 81 per cent of purchases made by first time buyers.
The Help to Buy equity loan scheme applies to all home buyers, not just first time buyers, who wish to buy a new build home but may be constrained due to deposit requirements.
The government helps buyers by issuing loans of up to 20 per cent in England and up to 40 per cent in London towards the purchase price of the property.
The report put the total value of properties sold under the scheme to date at £42.23bn and calculated the average property purchase price at £249,708.
Steve Seal, director of sales and marketing at Bluestone Mortgages, said the latest statistics highlight the number of borrowers relying on Help to Buy.
He said: "The market contains pockets of borrowers, like first time buyers, who require extra support to reach their homeownership aspirations, particularly as the cost of living becomes ever more expensive - as an industry it is essential that we ensure that provisions are in place to cater to a wide range of needs."
Mr Seal said specialist lenders also play an important role in helping the pool of customers struggling to secure funding after being deemed 'too high risk' by mainstream lenders.
Craig Hall, new build manager at Legal & General Mortgage Club, agreed Help to Buy had become an important part of the housing market, helping first-time buyers get on the property ladder and supporting growing families moving up the ladder.
He said: "Whilst the scheme certainly eases the issues with affordability and a raising a large deposit, over recent years we have seen mortgage lenders improving their core new build offering, providing further choice and reducing the dependency on the scheme for many borrowers.
"It is no secret that we need to build over 300,000 new homes a year to keep up with demand - and the government will need to find a range of solutions in order to help meet this target."
Yesterday, the government announced its support of three startup companies offering fintech apps to support renters struggling to get on the property ladder.