Help to Buy loans to reach £1bn, government says
- Published on Thursday, 02 January 2014 11:03
- Written by Daniel Mason
Close to 750 homes have been purchased under the Help to Buy scheme since its launch in October – while more than 6,000 people have put in offers on a house and applied for a mortgage, according to figures released today.
Should all the mortgages be approved it would represent almost £1bn of new lending to potential home owners, the government said.
Prime Minister David Cameron claimed the programme had helped thousands of people to “fulfil their aspirations and enjoy the security of owning their own home”.
Critics have warned that Help to Buy – which allows people to apply for a government-backed mortgage with a deposit of as little as 5 per cent – could lead to a housing bubble.
House prices rose 3.2 per cent in England and Wales in the year to the end of November, with prices in London soaring 10.6 per cent, according to the Land Registry.
But Cameron defended the scheme today, saying: “Too many people have found themselves frozen out of the market in recent years as a result of the size of the deposit required.
“That is why part of our long-term economic plan we introduced the Help to Buy scheme, so hardworking people with sufficient earnings can get on, fulfil their aspirations and enjoy the security of owning their own home.”
The new data covers the period from the start of Help to Buy through until December 18.
Cameron added: "In less than three months the scheme has already helped thousands of people. I want to see that continue in 2014."
Labour’s shadow housing minister Emma Reynolds said any help for first time buyers was “to be welcomed” but that rising demand had to be matched with rising supply to bring prices within the reach of low and middle income earners.
“Instead under this government housebuilding is at its lowest level since the 1920s,” she said “You can’t deal with the cost of living crisis without building more homes. That’s why Labour has committed to building 200,000 homes a year by 2020.”