An announcement was made in the recent budget (29th October 2018) that a new Help to Buy scheme will replace the current one and run for two years; until March 2023.
The new scheme however comes with stricter eligibility criteria. From April 2021, the new Help to Buy scheme will only be available to first-time buyers and there will be new caps on house price introduced.
The new Help to Buy scheme eligibility 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.
| Region |
Price cap for properties eligible for Help to Buy Equity Loan scheme from April 2021 to March 2023 |
|
| North East |
£186,100 |
| North West |
£224,400 |
| Yorkshire and The Humber |
£228,100 |
| East Midlands |
£261,900 |
| West Midlands |
£255,600 |
| East of England |
£407,400 |
| London |
£600,000 |
| South East |
£437,600 |
| South West |
£349,000 |
Source: HM Treasury analysis
Government backing for Help to Buy
The government plan to invest £22bn in Help to Buy by March 2021 to fund the mew Help to Buy scheme, 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.”
Kevin Roberts, Director of Legal & General Mortgage Club, commented on 29th October: “Today’s anouncementn of the new Help to Buy scheme 2021-23 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.”