An announcement was made in the recent budget (29th October 2018) that the Help to Buy scheme will run for another two years; this means that the scheme will now end in March 2023.
The extension however comes with new restrictions; Help to Buy will only be available to first-time buyers from April 2021, and there will be new caps on house price introduced.
Help to Buy Restrictions April 2021 – March 2023
To buy a new home using the Help to Buy scheme after April 2021, you will need to be a first-time buyer purchasing a home that falls under the price cap in your region (see below).
The price caps will be calculated at 1.5 times the average price of homes bought by first-time buyers. Starting at £186,100 in the North East, the cap will go up to a maximum of £600,000 in London.
Source: HM Treasury analysis
||Price cap for properties eligible for Help to Buy Equity Loan scheme from April 2021 to March 2023
|Yorkshire and The Humber
|East of England
Government backing for Help to Buy
The government plan to invest £22bn in Help to Buy by March 2021 to fund the extension, which is expected to help up to 360,000 new homes be purchased.
The government said: “Conditions have improved in the market since 2013: there is a growing number of high loan to value products available to first-time buyers and housing supply continues to increase.
“To ensure future help is targeted at those who need most help into homeownership, the Budget announces that from April 2021 a new Help to Buy Equity Loan scheme will run for two years before closing in March 2023.”
There are no further plans to extend the Help to Buy Equity Loan scheme after March 2023.
Kevin Roberts, Director of Legal & General Mortgage Club, commented on 29th October: “Today’s extension of the Help to Buy scheme to 2023 has provided much-needed clarity over the scheme. Not only do housebuilders now have more certainty for longer-term planning and building the thousands of new homes our country so desperately needs, but it also gives potential buyers who are saving for a deposit the peace of mind that they too can benefit from the scheme over the coming years.”