Two years ago, George Osborne introduced the government’s flagship ‘Help to Buy’ scheme to the world, in a bid to get more First Time Buyers onto the property ladder. The scheme was welcomed by many young home-hunters struggling to break the rental cycle and make their first steps into homeownership, however recent research has shown that uptake of H2B has not yet reached its full potential.
Credit comparison website, TotallyMoney.com, have created a brand new interactive heat-map showing the number of Help to Buy completions across the country. This useful resource for FTBs has shown that almost half of all postcode districts in England have not seen any mortgage completions under the H2B scheme – despite there being more than 400,000 eligible homes currently available across the UK.
Some areas have had much more success with the scheme than others, with Leicester taking the top spot for the most H2B activity with 892 mortgage completions thanks to the scheme. However, the map also shows that there are a shocking 1,261 ‘black spots’ with zero H2B completions, showing significantly different success rates across the country.
Osborne’s Help to Buy scheme is composed of 2 parts:
1. The ‘Equity Loan’ scheme which allows First Time Buyers to receive a government-backed loan of up to 20% of the property‘s value, interest-free for the first 5 years. Buyers using this part of the scheme will require a minimum 5% deposit and will need to secure a mortgage to cover the remaining 75% of the property value.
2. The second phase of H2B is the ‘Mortgage Guarantee’ scheme, which offered mortgage providers extra incentives to lend higher loan-to-value mortgages by way of a government guarantee. Hopefully leading to easier access to finance for FTBs.
TotallyMoney.com’s interactive heat-map allows you to view the uptake figures for both parts of the scheme independently, but more importantly, it also shows you the number of H2B-eligible properties in a given area. Part of the problem with properly implementing Help to Buy was that FTBs were unsure of how to access the funds, or if there were even any eligible properties in the area they were hoping to buy a home – so a simple resource like this one should not be overlooked.
You can explore Totally Money’s interactive Help to Buy map here.
Need some more help getting to grips with H2B? This simple and clear infographic sums it up nicely.