Help-to-Buy, Equity Loan Schemes and Mortgage Guarantee’s – all helping to get the housing market moving again

With high house prices, many second home owners and a limited supply of housing due to the rural area in which we live, many young people across Torridge and West Devon are finding it increasingly difficult to get on the property ladder.

Add to this the fact that since the financial crisis, larger deposit requirements and reduced equity values mean many credit-worthy households cannot get a mortgage, or are trapped in their existing homes unable to take the next step, and it becomes clear that steps had to be taken to get the housing market moving again. 

This is why the previous Conservative-led Government introduced the Help-to-Buy scheme, a package of measures to increase the supply of low-deposit mortgages for credit-worthy households. The success of this and other schemes means that the number of first-time buyers increased by nearly 60 per cent between 2010 and 2014.

The main components of the Help-to-Buy scheme are the Equity Loan scheme and the Mortgage Guarantee scheme. The Equity Loan scheme provides buyers with an equity loan of up to 20 per cent of the value of a new build property, repayable once the home is sold.

While the Mortgage Guarantee scheme, which helps people to access an affordable mortgage with only a five per cent deposit, is coming to an end this year, it is extremely pleasing to see that the Equity Loan scheme has been extended. The extension means that a further £8.6 billion will help up to 145,000 more people buy a new-build home.

I also welcome the announcement of the Help-to-Buy ISA, which supports people saving up for their first home by providing them with a maximum government bonus of £3,000 on £12,000 of savings - a boost of 25 per cent.

Over 150,000 people have bought their own home through Help-to-Buy, with 80 per cent of completions made by first-time buyers, and I am confident that many more, including those living in this constituency, will benefit in future, gaining the valuable foothold they need in the housing market.

Geoffrey Cox MP