We’ve waited with bated breath through the past few budgets for news of a scheme to help first-time buyers onto the property ladder. But so far, there’s been nothing. The popular Help to Buy scheme ended in March 2023, and no replacement has been introduced.
This isn’t just a problem for first-time buyers—it affects the entire housing market. As a result, leading industry figures are now calling for urgent government support.
Recognising the dire situation many buyers face, the House Builders Federation (HBF) has launched a new report. Titled “Broken Ladder. Stairway to Never,” the report explores the history of homebuying schemes, outlines the current challenges facing first-time buyers, and proposes a new approach to support them.
The report also suggests a new scheme that would give buyers access to a wider range of affordable mortgage deals.
Buying a first home has long been difficult, and the challenges only continue to grow. First-time buyers today face high house prices, difficulty saving for deposits, and rising mortgage costs.
While house prices are no longer rising as rapidly as they did post-pandemic, they remain high. According to the Office for National Statistics (ONS), average earnings have doubled since 1997, but house prices have increased more than fourfold. The HBF reports that the average price-to-income ratio in England is now 10. In regions like the South East, South West, and East of England, it rises to 12—and in London, it reaches 16.
These high prices make it harder to save for a deposit. Many buyers rely on family support—the so-called ‘Bank of Mum and Dad’. For those without help, saving becomes even more difficult, especially with rising rent costs due to a shortage of rental properties. This creates a financial trap, where potential buyers are stuck paying high rent while struggling to save.
Mortgage rates have also risen significantly in recent years, further putting homeownership out of reach for many.
Government schemes like Help to Buy made homeownership possible for many who might otherwise have missed out. The scheme followed FirstBuy in 2011, which offered a 20% loan co-funded by the government and developers, helping 16,500 buyers into their first homes.
Help to Buy, announced in the 2013 Budget, aimed to restore confidence in the housing market following the global financial crisis. It boosted both housebuilding and the availability of low-deposit mortgages. In its first eight years, the scheme wasn’t limited to first-time buyers and had no income cap—yet 82% of the 328,000 homes purchased through the scheme went to first-time buyers.
Clearly, Help to Buy helped thousands achieve homeownership. Without it—or a similar alternative—many aspiring homeowners now face an uphill battle.
The HBF’s report makes one thing clear: first-time buyers need support now more than ever. That’s why the federation is calling for a new targeted equity loan scheme designed specifically for them.
Such a scheme wouldn’t only benefit buyers. It would also support lenders, developers (large and small), and help the government meet its goal of building 1.5 million homes within five years.
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