Our friends at comparethemarket.com have taken an in-depth look into the current health of the well-known Help to Buy scheme. With the end of the Help to Buy ISA imminent, the price comparison site wanted to examine the data to see just how many homebuyers have taken advantage of the scheme, how much the government has loaned and paid out and where the country’s Help to Buy hotspots are located.
The research, while showing the reality of the numbers, also gives an easy breakdown of the programme in an easily digestible and relatable manner.
The Help to Buy programme was introduced in 2013 and consists of two main parts – an equity loan and the Help to Buy Individual Savings Account (ISA). Since its inception, over 200,000 homes have been bought in England using the Help to Buy equity loan and around 286,604 bonuses paid on Help to Buy ISAs, to a value of around £258m.
The number of houses bought under the scheme has steadily increased from 14,023 (2013) to 52,05 7 (2018), with 81.08% of those taking part being first-time buyers.
|Year||Completions||Value of equity loans (£m) at completion|
The data also shows that the region with the highest uptake of the equity loan is the South East, with 35,864 . The North East is the lowest. The value of the equity loans can depend on property prices, so it may be no surprise that London has received the second-largest amount from loans, with an average of £2.28bn . The South East comes in first place with a value of £2.31bn. The study also splits the uptake and amount received from equity loans into local authorities.
The Help to Buy ISA was launched in December 2015 and since then, 286,604 bonuses have been paid out, to a value of £258m. The number of people taking advantage of this scheme has risen from 62,256 (2016) to 114,786 (2018). The values of bonuses have also increased over time from £0.15m (Feb 2016) to £10.49m (Dec 2018). The study also splits the average bonus received into local authorities.
The data reveals the age bands of those receiving ISA bonuses, with 67% received by those aged between 25-34 years.
|Age Band||Volume of bonuses||Percentage of Total Bonuses (%)|
|< 18 years||1||0%|
|18 to 24 years||63,881||22%|
|25 to 34 years||191,608||67%|
|35 to 49 years||29,918||10%|
|50 to 64 years||1,144||0%|
The scheme has undoubtedly helped many people get onto the property ladder, but the research shows that some areas are benefitting more than others. The scheme was introduced as ‘the biggest intervention in the housing market since the Right to Buy scheme of the 1980s. Has it lived up to its expectations?