Help to Buy homes running short as builders can't keep up with demand

JOnathan Prynn

London is running short of homes available under the Government’s Help to Buy scheme because developers cannot keep pace with demand, figures reveal today.

There were just 1,619 properties left in the capital eligible for scheme funding last month, down almost two thirds from 4,535 at the end of 2017.

The worst-hit borough was Hammersmith & Fulham, where there was just one home left on the market — a £595,000 one-bedroom flat near Fulham Broadway.

The scheme, which allows Londoners to apply for government equity loans of up to 40 per cent for new-build homes worth up to £600,000, was announced in the 2013 Budget. It means they only have to put up a deposit of five per cent, making it easier to access mortgages at low interest rates.

There is a particularly severe shortage of houses, with none available for sale in 15 boroughs. Only Croydon, with 23, had a supply of Help to Buy homes running to double figures. The scheme is due to end in 2023.

Joseph Daniels, chief executive of modular home developer Project Etopia which compiled the figures, said: “Only rapid house building on a large scale and innovative ideas will prove to be a lasting antidote.”

Separate figures out today suggest demand could be stoking prices. The average price of a first-time buyer home under Help to Buy across Britain is £298,927, compared with £236,000 for all first-time buyer homes.

Figures released last month showed that the total value of government loans advanced under Help to Buy has exceeded £10 billion, helping more than 195,000 purchasers. Critics claim the scheme has swelled the profits of housebuilders at the taxpayers’ expense.