Help to Buy sales have fallen 46% as the full impact of stricter eligibility criteria and price caps are seen in the headline figures for the first time.
Official government data published today shows there were just 7,270 house purchases through the Help to Buy equity loan scheme in the three months to 30 September last year. This is down 46% on the 13,353 sales recorded in the same period in 2020, and 36% down on the same period in 2019.
The three-month period to 30 September is the first to only include sales from the new version of Help to Buy. The previous quarter’s figure of 10,824 was inflated by delayed sales under the previous scheme, which accounted for around a fifth of sales.
The new version of Help to Buy launched in April last year includes tightened eligibility criteria to ensure it is only used by first time buyers. The government also introduced regional purchase price caps based on 1.5 times the average regional first-time buyer price, ranging from £186,100 in the north-east to £600,000 in London.
The Home Builders Federation this morning repeated its warning that the new rules have made the scheme unviable in parts of the northern and midlands regions.
A HBF spokesperson said: “The large drop offs in Help to Buy supported purchases in areas where the scheme had been very popular such as Manchester, Wigan, Cheshire, Newcastle and Rugby are unsurprising.
“Sales rates overall however continue at the very high levels we have seen since lock down ended last year, an indication of the reducing reliance the industry has on the scheme.”
“While demand for new homes remains very strong, as the scheme winds down ensuring first time buyers in particular continue to be able to access high loan-to-value mortgage products will be essential if housing supply levels are to be maintained.
In December, Housing Today’s analysis of obtained Help to Buy sale data for April to June showed sales dropped following the introduction of the new in every English region apart from London, with particularly steep drops in the north west, west midlands and north east.
