Government ministers have been asked to extend the Scheme beyond its planned December deadline to support buyers whose purchases have been delayed by the pandemic.
For first-time buyers only, the scheme is due to end in April 2021 and a new version of the scheme will run from April 2021 to March 2023. Therefore, if the original scheme ends when planned, sales transactions will need to be agreed by December 2020.
The Government was first reported to be considering an extension to the Help to Buy scheme in April, amid the Covid-19 lockdown. The property sector has been heavily impacted due to the shutdown of construction work and sales offices, bringing the construction of thousands of new homes to a halt.
Ahead of the lockdown, the latest Government statistics show that the number of properties purchased through the Help to Buy scheme fell by 9% in the first quarter.
The Help to Buy Scheme has played an important role in the new build housing market for the past seven years. Figures show that the scheme has been used for more than 250,000 house purchases across the UK and has been a great support for thousands of first-time buyers. The news that the Government is drawing up plans to extend the scheme will be important as many house builders across the UK will no doubt be revising their timetables for completions after the lockdown.
The extension will also help to support the growing demand for Help to Buy amongst homebuyers, including buyers with smaller deposits who now face a much more limited choice of high loan-to-value mortgages. First time buyers are now seeking the support of independent mortgage advisers to find alternative solutions. Recent research by the Financial Reporter shows that 13% of first-time buyers now plan to use the scheme, who previously hadn’t considered Help to Buy before the current crisis.