How will housebuilders cope after the end of Help to Buy?


After six years of cheap loans for homebuyers, Help to Buy is being wound down. How will housebuilders cope with the change?

“Nothing lasts longer than a temporary government programme,” as Ronald Reagan once said – and Help to Buy could be seen as a textbook example. 

The UK government housebuilding support programme was originally launched in 2013, when concerns were widespread that the post-financial crash UK was about to plunge into the second descent of a double-dip recession. 

Under the scheme, homebuyers receive from the government an equity loan, equivalent to 20% of the value of the property they are buying. The loan is interest-free for five years, and all homebuyers have to stump up is a 5% deposit.  

The scheme was only meant to run until the end of 2016 but was given a last-minute stay of execution by the chancellor, Philip Hammond. Then last year Help to Buy won another lease of life when Hammond extended the scheme to 2023, albeit with a few tweaks. 

Here, Housing Today examines how reliant housing supply has become on Help to Buy, the likely impact of the soon-to-be introduced restrictions and whether the housebuilding industry can be weaned off its subsidy fix. 

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