Will ‘Help to Buy’ cause a housing market boom? 2

Home Office

Help to Buy was due to start in January 2014 but it’s been brought forward to start this week.

Here is a link to the 2013 Budget Info Graphic explaining how it works (the rules have been changed a little but it’s a good outline) – HM Treasury

Here is David Cameron announcing the scheme on the BBC on Sunday 29th September

A Help to Buy mortgage guarantee lets you buy a newly built home or an existing property with a deposit of only 5% of the purchase price.

Help-to-Buy will initially be available under the Nat West, RBS and Halifax brands.

Help to Buy mortgage guarantees will be open for loans not only to first time buyers but also to existing homeowners, and be available on new and existing houses with a value of up to £600,000. Buyers must have a 5% deposit.

The Government will guarantee the next 15% of the loan for a fee.

The Help to Buy mortgage guarantee will increase the supply of high loan-to-value mortgages.

The plan has drawn criticism from the International Monetary Fund and Business Secretary Vince Cable, who say it may spark a property bubble.

What do you think?

steve@bicknells.net