Between 1 October and 31 December 21,026 properties were bought with an equity loan, according to the data from the Ministry of Housing, Communities and Local Government (MHCLG).
This is 40% more than the same period in 2019 and it means, since the scheme began in April 2013, a total of 313,043 properties were bought with an equity loan.
The total value of these equity loans is £18.9 billion and the value of the properties sold under the scheme totals £86 billion
The MHCLG figures also showed 82% of all completions were made by first-time buyers.
The huge surge in numbers came just before changes to the Help to Buy Equity scheme – which included regional caps and exclusivity to first-time buyers – came into force.
However, it also came just a few months after the property market closure due to the pandemic. Indeed, the MHCLG figures showed between April and June 2020 Help to Buy Equity figures were down 61% against the same months in 2019.
Lisa Martin, development director at TMA Club, said: “The Help to Buy scheme continues to be a vital resource for aspiring homebuyers in need of extra financial support.
“For first-time buyers in particular, a cohort that has been disproportionately impacted by the Covid-19 pandemic, Help to Buy has been a lifeline, and the demand we are seeing from this community is likely to continue ahead of the scheme’s closure in 2023.
“Promisingly, support for could-be homeowners remains a priority for the government. In addition to Help to Buy, the 95% mortgage guarantee scheme should also go some way towards supporting homebuyers with their property purchases.
“Moreover, this week’s Queen’s Speech further reaffirmed the government’s focus on tackling some of the issues felt by aspiring homeowners.”
‘Well-meaning but flawed’
However, Karen Noye, mortgage expert at Quilter, was more sceptical. What’s more, she said the figures illustrated how ineffective the stamp duty holiday had been for first-time buyers.
“The average purchase price using the Help to Buy scheme since 2015 is £174,531, which is well below the threshold over which people must pay stamp duty anyway,” she said.
“Due to the extended stamp duty holiday, first-time buyers are now having to compete in an overheated property market populated with more buy-to-let investors with far more equity to sweeten a deal.
“While the Help to Buy scheme is clearly well-meaning, its range of flaws have meant that it has not been anywhere near as successful as it could have been.”
She added: “All these government schemes are well meaning but none of them tackle the problem like simply building more housing stock. The government must make this a priority going forward if they want to give generation rent a chance to get on the housing ladder.”
