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Nearly 325,000 homes purchased through 'Help to Buy' scheme

Abigail Fenton
·2-min read
The cost of insuring your home against  has shot up 27% in three years. (Terrah Holly/Unsplash)
Lifetime lSAs may now be a good alternative to the Help to Buy equity loan scheme, experts say. Photo: Terrah Holly/Unsplash

Almost 325,000 homes across the UK have been bought through the government’s Help to Buy affordable housing scheme since its launch in December 2015.

Help to Buy individual savings accounts (ISAs) — through which the government boosts first-time home-buyers’ savings by 25%, up to a maximum of £3,000 — have now supported 323,767 property completions, official data shows.

So far, 426,565 “bonuses” — or government boosts — have been paid to Brits, with the average bonus coming in at £1,000, leading the overall value of bonuses to £426.74m ($542.5m) by the end of March, according to the Treasury.

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On top of this, 272,852 homes have been bought through Help to Buy equity loans — where the government lends first-time buyers and homeowners money to buy a newly-built home — since that scheme was launched in April 2013, official data shows.

According to the government, the average home purchased with a Help to Buy ISA cost £173,878, while those bought with a Help to Buy loan cost about £268,553 — against the UK’s average first property price of £194,718, and average house price of £231,855.

The Help to Buy ISA scheme closed to new savers on 30 November 2019. While the equity loan scheme remains open until 2023, “the costs and complexities involved mean it may not be a good idea to grab one while you can,” said Sarah Coles, personal finance analyst at Hargreaves Lansdown.

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“[This] means future homebuyers may need to look elsewhere for help getting onto the property ladder, and the lifetime ISA can be a useful alternative,” Coles said, referring to a similar, longer-term scheme, through which the government will boost first-time buyers’ — or those saving for later in life — savings by 25%, up to a maximum of £1,000 a year.

“If you are saving for your first home, are aged 18 to 39, have at least a year until you want to buy, you could get up to £1,000 a year of free money from the government to put towards your property deposit,” she explained.

Brits can put up to £4,000 of cash or stocks into a lifetime ISA every year until they turn 50.