The industry has been called on to come together to ensure Help to Buy purchasers meet the extended deadline for the government scheme.

The Help to Buy legal completion deadline has been extended by two months to 31 May, following housebuilding delays due to the pandemic.

Homes England, which administers Help to Buy, says: “Help to Buy will end on 31 March 2021, but homebuyers using the current scheme will have more time to complete their purchase. We are extending legal completion to 31 May 2021 due to delays caused by coronavirus.”

It added: “There will be no more extensions, so we are asking homebuilders to continue to build at pace.”

The move was welcomed across the housing industry, with at least one major lending club renewing calls for an extension to the 31 March deadline on stamp duty relief. Homes England moved on Help to Buy, which allows people to buy a new-build home with a 5 per cent deposit, after house projects slowed due to problems caused by the health crisis.

Building sites experienced delays in getting hold of material such as timber, plaster and insulation and developers were hit by staffing problems with workers off sick or self-isolating.

However, Homes England said it had no intention of extending the scheme in November.

Applications for the current 2013-2021 scheme closed on 15 December 2020 so the extension only applies to those applications already underway.

Homes England says that if a new build in the scheme is severely delayed and cannot meet legal completion by the end of May the housebuilder “must unconditionally” release the buyer from the contract.

It added that homebuilders must refund reservation fees for those who do not go ahead with buying a property.

Legal & General Mortgage Club head of broker relationships & propositions Craig Hall says the extension provides “a much-needed breathing space for consumers to finalise their home purchase before the current scheme ends”.

Hall adds: “The wider mortgage industry, including advisers, lenders, surveyors and conveyancers, must now work together to ensure those using the current Help to Buy programme are able to complete on their purchase as quickly as possible.

“Importantly, with the current stamp duty holiday due to end on 31 March, those unable to complete before this date will need to pay the associated Stamp Duty on their property, although first-time buyers in England will remain exempt up to £300,000. Tapering the holiday deadline could help avoid this cliff edge – something we hope policymakers will consider in the forthcoming Budget.”

Broker SPF Private Clients chief executive Mark Harris adds: “This grace period is hugely welcome as it allows some breathing space for purchases on the current Help to Buy scheme to complete. However, buyers should note that as it stands the stamp duty holiday still ends on 31 March, should their property be affected.”

Broker Private Finance associate director and mortgage consultant Chris Skyes says: “This extension is a weight off so many shoulders worrying whether their property was going to be ready on time and giving new build companies the time to finish properties to the expected standard rather than being in a manic rush with sales potentially falling through if the deadline wasn’t hit.”

The new Help to Buy scheme for first-time buyers only starts on 1 April 2021 and ends 31 March 2023.