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Housing minister: announcement soon on reforms to Help to Buy
The government will announce reforms to its Help to Buy scheme “quite soon”, the housing minister has said.
Speaking at the Conservative Party Conference yesterday, Kit Malthouse confirmed speculation that the government plans to adjust the policy.
The scheme, under which the government loans money to buyers of new build homes, has come under fire recently and there has been widespread speculation that the government is seeking to change it.
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At a fringe event, Mr Malthouse told the audience: “There’s a lot of people out there trashing Help to Buy, but I think that’s one scheme that people come up to me all the time and thank me for. I get lots and lots of young people coming and thanking me for Help to Buy because it finally got them onto the housing ladder.
“One of the criticisms of it is, is it hitting the right people? Certainly, the policy is under review as you would expect. We’re hoping to make some announcements quite soon. We want to make sure that it is hitting the right people. But the actual decisions about Help to Buy are well above my paygrade.”
At the same fringe event, David Thomas, chief executive of Barratt Homes, Britain’s largest house builder, said: “I’m not so worried about Help to Buy being curtailed. What Help to Buy does is it allows people to provide a 5% deposit to purchasing a house, and that is not generally available in the wider market.
“The banks have been hugely constrained as to the percentage loan to value that they can lend, so gone are the days when banks would readily lend 95%. It’s just economic for the banks and there has to be some alternative, whether that be Help to Buy or whether that be something else.”
This time last year, the government announced a £10bn boost to the scheme, which allows buyers to access an interest-free government loan worth up to 20% of the property’s value.
Economists have criticised the scheme for driving up house prices. Critics have also suggested that Help to Buy is being used by better-off buyers than those it was originally aimed at.
