Government should focus attention on other areas as loan scheme starts to wind down, says Project Etopia founder
A modular homes specialist has called for his industry to be offered incentives after the government released figures which show the value of loans distributed under its Help to Buy scheme had amounted to nearly £11bn since the initiative began in 2013.
Joseph Daniels, founder of modular housebuilder Project Etopia, said recently-announced changes to the scheme, which include being limited to first time buyers from 2021, would take the heat out of the market before it finally closes two years later.
“This presents an opportunity for policy makers to focus their attention elsewhere. The country needs to get the balance right between new building and demand-side measures like Help to Buy, which simply improve the financial position of prospective buyers.”
Daniels said policies should focus on encouraging capital to continue to flow into the building of new homes rather than just creating an artificially robust market for them.
“Improved incentives for the modular market present the only realistic strategy for meeting the government’s housing targets,” he added.
The government said 195,219 homes had been bought using Help to Buy, with first time buyers accounting for 81% of total purchases.
The mean purchase price of a property using the scheme was £255,542, with the average mean equity loan coming in at £54,630.
Mark Dyason, managing director of property broker Thistle Finance, warned that when Help to Buy comes to an end in four years’ time the fallout for the biggest developers that had benefited from it the most could be devastating.
“The scheme is arguably a hollow victory with the potential to cause all manner of problems both for the buyers who have used it and the developers that have offered it.
“We live in an era of short-termism but the fall-out from artificial props like Help to Buy could be long-term,” he said.
No comments yet